tag:blogger.com,1999:blog-50973238046967771402015-02-19T11:00:08.943+01:00FOSS PatentsThis blog covers software patent news and issues with a particular focus on wireless, mobile devices (smartphones, tablet computers).Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comBlogger1750125tag:blogger.com,1999:blog-5097323804696777140.post-16623788381299634802015-02-19T11:00:00.000+01:002015-02-19T11:00:08.986+01:00European Patent Office staff asks a good question: How many patents does Europe need?<p>Since December, I've been following the <a href="http://www.fosspatents.com/2015/01/dear-epo-leadership-judge-subjected-to.html">labor and human rights conflict at the European Patent Office and the debate over judicial independence</a>. I'm less concerned about particular people holding certain positions (<a href="http://techrights.org/2015/02/11/zeljko-topic-kopcic-and-sanader/">TechRights'</a> Dr. Roy Schestowitz covers those issues in detail) than fundamental, structural deficiencies that have allowed judicial independence at the EPO to wither. And when <a href="http://www.fosspatents.com/2014/12/european-patent-office-examiners-fear.html">patent examiners warn that patent quality is in jeopardy</a>, I tend to listen carefully.</p><p>The Staff Union of the European Patent Office (SUEPO) has announced another demonstration. It will take place in Munich next Wednesday. EPO staff will march to the British consulate (on January 24 they went to the Danish consulate) and hope to meet the British Consul-General in Munich. It makes sense that SUEPO talks to the national governments that are ultimately responsible for what's going on at the EPO. The British government has also just received a <a href="http://ipkitten.blogspot.de/2015/02/cipa-gives-administrative-council.html">letter from the UK's Chartered Institute of Patent Attorneys (CIPA) that IPKat reported on</a>. That's definitely an awareness-raiser.</p><p>Here's SUEPO's flyer announcing the next demonstration (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View SUEPO Demo 15-02-25 on Scribd" href="https://www.scribd.com/doc/256230324/SUEPO-Demo-15-02-25" style="text-decoration: underline;" >SUEPO Demo 15-02-25</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/256230324/content?start_page=1&view_mode=scroll&access_key=key-H2KS82OkcQu1ng6Xqb2P&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7080062794348508" scrolling="no" id="doc_90956" width="100%" height="600" frameborder="0"></iframe><p>The parts of the flyer that particularly caught my interest are at the beginning and at the end. The question of how many patents Europe needs is a good starting point for the EPO reform discussion. In some contexts, less is more. SUEPO's concern is that EPO president Benoît Battistelli's emphasis on "efficiency" reflects a lack of focus on patent quality:</p><blockquote><p>"According to staff, efficiency is not an aim by itself: it is subordinated to the Office's duty, as a public service, to examine patent applications <b>thoroughly</b> and to refuse any 'bad' patents that would otherwise be a nuisance, in particular for the many European small and medium-sized enterprises that cannot afford expensive litigation. Mr Battistelli's single-minded focus on 'efficiency' and cost cutting is not in the interest of Europe!"</p></blockquote><p>What I don't know is whether there are areas (and in large organizations there often are some) in which costs could be reduced without any negative impact on examiners' ability to decline to grant "bad" patents. However, SUEPO's concern is understandable in light of an official document (minutes of May 2009 board meeting), cited at the end of the flyer shown above, which says that Mr. Battistelli as well as EPOrg Administrative Council chairman Jesper Kongstad shared the following philosophy:</p><blockquote><p>"Priority on increased output should be the leading consideration."</p></blockquote><p>To be fair, not everyone who calls for increased output is necessarily against quality. However, the leadership of a patent office should, as a matter of principle, always view patent quality as the number one priority, with efficiency being a close second if there are objective indications of inefficiencies and a distant second if benchmarking and other types of analysis suggest that any further efficiency gains would be limited or, if overreaching, come at the expense of patent quality.</p><p>I have the impression that the EPO staff is genuinely concerned about patent quality. It appears to me that these people really want to be able to do a good job (that they can be proud of), and their perspective on their job is that they have to serve the public interest by rejecting bad patent applications. I'm not saying that this is the only reason they oppose Mr. Battistelli's reform agenda, but at the very least it's a significant and credible part of the consideration, not just a pretext.</p><p>One of the structural problems (which in turn is the root cause of other structural deficiencies) is that the EPO basically mints money for national patent offices by putting out many patents, and only by <i>granting</i> (not by rejecting) applications -- otherwise there's no money to be made for national patent offices. In business terms, the EPO generates, by granting patents, income for national patent offices through local registration and renewal fees that are almost entirely a gross contribution to the bottom line. It's all too tempting for national government representatives to go for short-term income rather than the long-term policy interest in patent quality. Like all analogies, this one isn't perfect, but imagine a situation in which a body deciding on fishing quotas would be controlled by the industry that supplies ships and specialized devices to the fishing industry. The ones in charge would then want more, not less, fishing because it serves their interests. It's in the public interest, however, to avoid overfishing -- and in the long run, that's also in the interest of the suppliers controlling the agency.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-10368556649654417872015-01-28T10:23:00.001+01:002015-01-28T19:57:41.178+01:00Industry body says Apple advocates rules that would give patent trolls access to injunctions<p>Recently the Federal Circuit scheduled the hearing on Apple's appeal of the <a href="http://www.fosspatents.com/2014/08/judge-denies-apple-bid-for-sales-ban.html">denial of a permanent injunction against Samsung after last year's trial</a>. The hearing will be held on March&nbsp;4. From the outside it looks like one of the last steps before this dispute will be history.</p><p>Three weeks ago I wrote about <a href="http://www.fosspatents.com/2015/01/competing-device-makers-htc-and-lg-join.html">Apple's opposition to an amicus curiae brief submitted by Google, SAP, Red Hat, Rackspace, and -- notably -- Samsung competitors LG and HTC</a>. The brief was accepted by the Federal Circuit over Apple's objections. Apple may have opposed the filing just because this was an opportunity to highlight Google's special involvement with the case in an effort to diminish the brief's credibility, but even if one viewed Google (like Apple suggested) as a <i>de facto</i> party to the case, the other filers have quite some credibility.</p><p>Cases should be decided on the merits, not on amicus brief campaigns. That said, it says something that Apple has support only from Nokia and Ericsson -- the company with which Apple <a href="http://www.fosspatents.com/2015/01/ericsson-may-demand-15-of-apples-sales.html">now has a dispute over potentially much more money than what the remaining parts of the Samsung case are about</a>, especially since the Apple-Ericsson situation is very unbalanced (Apple has much less offer to Ericsson in terms of a patent license, so it won't be able to offset the inbound licensing cost with much of an outbound licensing revenue stream).</p><p>Besides the aforementioned group of companies, the Computer &amp; Communications Industry Association (CCIA), whose members are <a href="https://www.ccianet.org/about/members/">listed here</a>, also submitted a brief. It already did so back in mid-December, but it appeared on the Federal Circuit docket only yesterday. I've also <a href="http://www.ccianet.org/wp-content/uploads/2015/01/2014-12-24-CCIA-amicus-brief-in-Apple-Samsung.pdf">found it (PDF document)</a> in the Briefings &amp; Filings section of CCIA's website.</p><p>It focuses on two issues. The first one is about whether a feature-specific injunction should be easier for Apple to obtain. CCIA argues that the scope of the injunction was already considered.</p><p>There's a second, shorter part that raises an issue I wish to highlight. CCIA says "the special treatment Apple requests would open the door to patent assertion entities [<i>i.e.</i>, patent trolls] to demand injunctions."</p><p>CCIA takes issue with the notion that a patent holder shouldn't have to prove a causal nexus between the infringement of a small feature of a multifunctional device and the alleged irreparable harm because it's so easy to work around.</p><p>In light of strict page limits, it would be unfair to both Apple and CCIA not to consider an important nuance: while this particular part of Apple's pro-injunction argument could indeed open the floodgates to injunctions obtained by patent trolls (which could also hurt Apple in the future), I understand Apple's position as being about the <i>combination</i> of the availability of workarounds <i>and</i> the patent holder having a "reputation for innovation." The second part would be much harder (though not impossible) for a patent troll to satisfy.</p><p>CCIA nevertheless has a point. In order to obtain an injunction against Samsung (over patent claims that are too narrow to give Apple strategic leverage), Apple must try different things to lower the hurdle. Apple wants to have its cake and eat it (get an injunction against Samsung but preserve much of its ability to fend off injunction demands by trolls), and that's always risky. Presumably the perfect outcome from Apple's point of view wouldn't be that the court reverses Judge Koh's injunction denial just based on the availability-of-workarounds basis. Apple almost certainly hopes for the aforementioned combination of that one with the "reputation for innovation" criterion. However, this here could go wrong in two ways:</p><ol><li><p>An appellate decision that emphasizes the "small feature" part (or is based entirely on it) would have exactly the effect CCIA warns against, whether or not this would have been Apple's intention. Apple can make its case but it can't write the decision even if it prevails.</p></li><li><p>I've previously criticized the "reputation for innovation" criterion as a very vague and soft one, and I think it runs counter to the traditional logic of the patent system, which is all about technological merits (what contribution was made to the state of the art relative to the prior art?). If this approach was adopted by the court, patent law would depart from its focus on rewarding inventiveness and start to reward PR and marketing. A patent troll (not a small one, obviously) could spend a lot of money promoting its inventions and its research and development efforts to maximize the leverage it gets from its patents. And if it has other licensees, those are arguably harmed by infringement, and by extension, the patent holder is then harmed as well.</p></li></ol><p>Apple is <a href="http://www.bloomberg.com/news/articles/2015-01-28/apple-is-crushing-wall-street-s-expectations-like-it-s-2010">doing so well</a>. It doesn't really need an injunction (over patent claims of limited scope) other than for publicity and pride. In terms of natural allies for Apple when it comes to balanced patent policy, the likes of Google, Samsung and SAP -- companies that also have a strong reputation for innovation -- would clearly be a better fit (because their uncompromised priority is on making real products) than Nokia and Ericsson. It's possible that just the increased cost of licensing patents from Nokia and Ericsson in the future (those also have non-standard-essential patents, so FRAND alone can't solve the entire problem for Apple) will outweigh any positive effects that Apple could get, in the most optimistic scenario, from a successful appeal.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-25987923711860947212015-01-23T12:40:00.001+01:002015-01-23T12:46:17.106+01:00Dear EPO Leadership: a judge subjected to an 'office ban' IS a suspended, temporarily-removed judge<p>It's time for a follow-up on what's <a href="http://www.fosspatents.com/2015/01/pressure-mounts-on-epo-president-and.html">going on at the European Patent Office</a>. The day before yesterday, the EPO staff union, SUEPO, took to the streets of Munich again--this time around, approximately 1,000 EPO employees went to the Danish consulate (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 15 01 22 SUEPO Flyer on Scribd" href="https://www.scribd.com/doc/253492780/15-01-22-SUEPO-Flyer" style="text-decoration: underline;" >15 01 22 SUEPO Flyer</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/253492780/content?start_page=1&view_mode=scroll&access_key=key-plnyZnxlPWDybxxjKRdr&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7080062794348508" scrolling="no" id="doc_51327" width="100%" height="600" frameborder="0"></iframe><p>The Danish consulate was chosen because a Danish public servant, <a href="http://en.wikipedia.org/wiki/Jesper_Kongstad">Jesper Kongstad</a>, is the chairman of the Administrative Council of the European Patent Organisation. I have heard from multiple sources that he's always aligned with controversial EPO president Benoît Battistelli.</p><p>The SUEPO flyer I published above contains some links, including one to this blog, and I recommend all of them. I wish to particularly highlight <a href="http://www.stjerna.de/index_htm_files/Unitarypatent_OpinionC-146_13.pdf">this article (PDF) by patent litigator Dr. Ingve Björn Stjerna</a> that connects certain dots between the proceedings before the Court of Justice of the EU concerning the future Unified Patent Court and the questions that have been raised about judicial independence at the EPO. The related part (entitled "The most recent developments at the EPO") begins on page 3 of the document.</p><p>One of the links points to a TechRights article, and there are a couple of other recent TechRights article I find interesting (which does not mean a wholesale endorsement): <a href="http://techrights.org/2015/01/22/epo-director-of-internal-communication-is-out/">this one</a> on the rumor that the EPO's recently-hired Director of Internal Communications has "resigned" and <a href="http://techrights.org/2015/01/18/topic-spin-attempt/">this one</a> on (so far unproven) allegations against a vice president of the EPO. The <i>de facto</i> suspension of a member of a board of appeal (<i>i.e.</i>, an EPO-internal judge) that has drawn much criticism from judges and lawyers was, <a href="http://www.lesechos.fr/journal20141212/lec2_industrie_et_services/0204009171427-tensions-a-loffice-europeen-des-brevets-1074346.php">according to French financial daily Les Echos</a>, due to whatever the suspended judge said about that vice president, Mr. Željko Topić.</p><p>You can find many interesting comments below <a href="http://ipkitten.blogspot.de/2015/01/judicial-independence-epo-responds-to.html">this IPKat post on an EPO-internal memo</a> with which a vice president, through one of his assistants, told the heads of examination units what he thought about <a href="http://ipkitten.blogspot.co.uk/2015/01/judicial-independence-europes-ip-judges.html">a letter by retired UK judge and professor Sir Robin Jacob</a> to the Administrative Council.</p><p>Here's my thinking: On the one hand, I can understand that the EPO leadership is increasingly nervous. I can also appreciate that they would prefer to handle matters like these internally and confidentially. But opacity has its limits, and the EPO is simply too important for people like Sir Robin (and so many others) to ignore what is going on there.</p><p>EPO vice president Minnoye is right that Sir Robin (and others, including me, except that I'm not aware of any EPO-internal communication about me) was "not aware of all facts" when he wrote his letter. But he had apparently received information from reliable sources according to which the suspended judge had not done anything that would explain why he had to be removed, why his computer had to be searched, and why he had to be denied access to the building. I'm sure Sir Robin would never have written the letter if there had been <i>the slightest indication</i> of, for example, the allegations having involved physical violence that others in the building had to be immediately protected from. Everything that the outside world has heard so far is about information and/or opinions the suspended judge shared.</p><p>That is enough for Sir Robin and others to conclude there was no basis for executive action. Whatever the issue may have been, it should have been properly investigated, and no matter how serious or not, this should have been adjudicated by a judicial body--not the president, not the Administrative Council--before taking such action.</p><p>The second point made by EPO VP Minnoye is that Sir Robin allegedly referred to a different type of executive action. Mr. Minnoye stresses this was an "office ban."</p><p>This is old news. It had already appeared <a href="http://www.fosspatents.com/2014/12/government-delegates-express-concern-at.html">in December</a> that the EPO leadership distinguishes between</p><ul><li><p>(temporary) office ban,</p></li><li><p>(temporary) suspension, and</p></li><li><p>(permanent) removal.</p></li></ul><p>This sophistry is not going to get them anywhere. The critics of the decision presumably (and in my case, I know it's definitely the case) just refuse to make that distinction because it's meaningless to them.</p><p>Let's think about it. A judge who is not allowed to enter the building can't hold hearings, can't (easily) meet with his peers on the same board of appeals to discuss the case, can't access certain document databases, can't use office equipment there, can't get help from assistants. He's simply unable to do his job for all intents and purposes.</p><p>How is that <i>not</i> a suspension? How does an executive's ability to make this decision <i>not</i> compromise judicial independence?</p><p>I've been saying for some time that it would be a mistake to focus just on Mr. Battistelli. The problems here are structural. Mr. Minnoye may very well be right that in formal terms, Mr. Battistelli can impose an "office ban" on a judge, and that this is allowed by a section of the EPO's rules that is different from the one on a suspension, and that a suspension is not a removal because it's temporary (another distinction that amounts to hairsplitting). So maybe Mr. Battistelli acted in accordance with the rules, some of which he made or changed himself (and the Administrative Concil rubberstamped). It's not really important whether Mr. Battistelli will leave the EPO in a few months or in a few years. All that matters is that the structural deficiencies that allowed the current situation to arise be addressed for once and for all. The national governments of the EPO contracting states are responsible for this.</p><p>The root causes are key. Mr. Battistelli is not a root cause. There are reasons to believe that under this leadership the situation exacerbated, but he does not share <i>political</i> responsibility. Dozens of European countries that believe they have to "remind" China and Russia of human rights and democracy issues time and time again have allowed the situation to get out of hand because they failed to put proper checks and balances in place.</p><p>Mr. Minnoye and Sir Robin can be right at the same time. I tend to think they both <i>are</i> right at the same time. In Sir Robin's case I'm sure, in Mr. Minnoye's case I can see that the EPO's rules probably support his logic.</p><p>The bottom line is that reform is needed. The Administrative Council has been part of the problem, not part of the solution. Sir Robin and others were too polite to address someone other than the Administrative Council. They should have contacted politicial decision-makers and members of different parliaments. The Administrative Council appears to be the fox in charge of the henhouse, though it would be great if it could prove its critics wrong in the months and years ahead and bring about meaningful change, rather than endorse and rely on meaningless sophistry.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-81087167328230021302015-01-16T08:27:00.001+01:002015-01-16T08:27:06.640+01:00Ericsson may demand 1.5% of Apple's sales from LTE-compatible iPhones and iPads for its patents<p>This is a follow-up to <a href="http://www.fosspatents.com/2015/01/apple-ericsson-spat-shows-some-big.html">yesterday's post on the dispute between Apple and Ericsson over standard-essential patent royalties</a>. I published Ericsson's complaint first because, though it was filed two days later, it appeared on a publicly-accessible court docket sooner. I also want to show you Apple's complaint now and say a few things about it (below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 15-01-12 Apple Complaint Against Ericsson on Scribd" href="https://www.scribd.com/doc/252788497/15-01-12-Apple-Complaint-Against-Ericsson" style="text-decoration: underline;" >15-01-12 Apple Complaint Against Ericsson</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/252788497/content?start_page=1&view_mode=scroll&access_key=key-Hs93lcVvPxsQ31x22Be1&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7747205503009458" scrolling="no" id="doc_94547" width="100%" height="600" frameborder="0"></iframe><p>Apple's complaint was filed by Wilmer Hale, one of the firms representing Apple against Samsung. Wilmer Hale originally focused on Apple's defense against Samsung but also became involved with offensive matters, especially in the Federal Circuit (access to injunctive relief). <a href="http://www.wilmerhale.com/mark_selwyn/">Mark Selwyn</a> has been a very key player on Apple's external legal team in the Samsung cases, in the U.S. as well as abroad (there was at least one Mannheim case in which he officially attended the trial). <a href="http://www.wilmerhale.com/joseph_mueller/">Joseph Mueller</a> (not a relative of mine) is a co-author of a <a href="http://www.fosspatents.com/2014/05/patent-royalties-may-exceed-120-per.html">study according to which smartphone patent royalties may exceed $120 per device and undermine industry profitability</a>. There's no reason to assume he's responsible for Apple's damages claim in the second California Samsung case (over five patents) that I criticized so harshly last year, or the design patent and trade dress damages in the first case.</p><p>It's the fate of lawyers and their firms that they stand on different sides of debates from time to time, and in this case it's not even inconsistent <i>per se</i> because Apple's position is that standard-essential patents have little value while non-SEPs should be deemed very valuable. While it's intellectually consistent, I disagree with the unbelievable discrepancy between Apple and WilmerHale's positions on SEP vs. non-SEP royalties. It's like they want non-SEPs on small features to be hundreds, if not thousands, of times more valuable than SEPs without which those devices wouldn't work at all. For example, <a href="http://www.fosspatents.com/2012/07/apple-seeks-25-billion-in-damages-from.html">in the first Samsung case Apple sought $2.5&nbsp;billion (mostly over design patents) from Samsung while arguing that half a cent per Samsung SEP was a FRAND royalty</a>. To WilmerHale's credit, the aforementioned study raises concerns over patent royalties that are not limited to SEPs.</p><p>Apple's complaint cites a former director of patents and licensing at Ericsson who publicly stated in 2010 that Ericsson expected to seek LTE royalties of 1.5% of the end product price. The filing also says the following:</p><blockquote><p>"In its public statements, Ericsson has never retreated from the position that it is entitled to an approximate 25 percent share of a total LTE 'royalty stack' based on a percentage of the end prices of entire LTE devices--such as full smartphone or full tablet computers. And Ericsson has never accepted that LTE licensing should begin with a component-focused royalty base, to which a reasonable rate is applied."</p></blockquote><p>Apple's complaint then picks seven LTE patents Ericsson asserted in other litigation and asks the court to hold those patents non-essential to LTE (in which case Apple wouldn't need to license them merely because it claims its products are LTE-compatible) or, should the court disagree on non-essentiality, to determine a FRAND rate for each of them. This patent-by-patent approach is unacceptable to Ericsson, which is why it asked the court in Texas to determine a portfolio rate.</p><p>The much more fundamental controversy here is not whether a FRAND determination should be made on a patent-by-patent basis but the question of the royalty base (<i>see</i> also the second sentence of the paragraph quoted above).</p><p>Ericsson basically takes the position that everything you run on an iPhone or iPad depends on wireless connectivity, so they should get a percentage of the device price. Apple's position has been for a long time that the price of a baseband chip is the proper royalty base against which some percentage should be applied, arguing that a "jalopy" and an expensive sports car also pay the same highway toll.</p><p>Obviously, access to injunctive relief has become much more difficult for SEP holders as a result of certain judicial decisions and regulatory interventions and settlements in recent years, at least in the U.S. and in Europe. But there were two key FRAND-related battles that the "net implementers" (my term for companies that are implementers of standards to a far greater extent than they seek to exploit SEPs of their own) haven't been able to win. The first one is about whether the exceptional cases in which injunctive relief is available should depend exclusively on the patent holder's behavior (since that's the party that made a FRAND pledge in the first place) or on both parties' conduct. The likes of Google (Motorola) succeeded in convincing judges and regulatory authorities that FRAND is a two-way street and an absolutely unwilling licensee may be enjoined from further infringement, as opposed to one that makes a good-faith, serious effort to obtain a license. There's no reason to believe that courts and regulators will change their stance on this one anytime soon. But the second question is the one Apple has now put front and center in its California case against Ericsson, and it's one on which the jury is still out though Apple does face a significant (or maybe even steep) challenge. The royalty base.</p><p>Even Judge Robart held in the <i>Microsoft v. Motorola</i> FRAND contract case that a royalty based on the price of a complete product as opposed to that of the smallest saleable unit (which Microsoft proposed in that case and which Apple is arguing now in the Ericsson case) may still be FRAND, as long as the percentage is low enough. However, in a different case (in Chicago), Judge Holderman <a href="http://www.fosspatents.com/2013/10/federal-judge-determines-19-wifi.html">agreed with a group of defendants against Innovatio's WiFi claims that the chipset price as the proper royalty base</a>.</p><p>It won't be easy for Apple to get a bright-line rule that a FRAND commitment is violated merely by using a different royalty base. In procedural terms, I think Apple would have to take the Ericsson case all the way up to the Supreme Court--and while there are reasons to assume that Apple will drop this case as soon as it can reach a reasonable deal with Ericsson, the question is strategically important enough to Cupertino that it may pursue this as a matter of principle.</p><p>While I'm not aware of any ruling in which a U.S. or European court categorically ruled out injunctive relief over SEPs even against unwilling licensees, it looks like the law on the royalty base isn't settled yet, so this could be an increasingly interesting case over the next few years. The days are long gone when this was mostly a "FRAND Patents" blog, but I plan to look at this dispute from time to time.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-34357471465695008502015-01-15T08:03:00.002+01:002015-01-15T08:03:35.904+01:00Apple-Ericsson spat shows some big-dollar licensing issues remain to be resolved in smartphone industry<p>Apple and Ericsson teamed up with others (Microsoft, Sony, BlackBerry, EMC) in 2011 to buy up Nortel's wireless patent portfolio. As <a href="http://www.fosspatents.com/2014/11/google-and-android-oems-apparntly-close.html">expected after a November motion</a>, the <i>Rockstar v. Android</i> dispute has come to an end. Patent aggregator RPX Corporation, which is closer to Google than to Apple and Ericsson, <a href="http://www.prnewswire.com/news-releases/rpx-corporation-purchases-rockstar-patents-300013522.html">bought Rockstar's patents in December</a>.</p><p>But Apple and Ericsson now have licensing issues to sort out between the two of them. They had a five-year patent license in place, and it has now expired, according to an <a href="http://www.ericsson.com/news/1886850">Ericsson press release</a>. Traditionally, 'tis the season for patent suits resulting from failure to agree on renewals. Many patent license deals have terms defined by calendar years, and in recent years there have always been filings of this kind in early January.</p><p>Apple has won the race to the courthouse with a declaratory judgment action (asking the court to find that some Ericsson LTE patents are neither essential nor infringed) it filed on Monday in the Northern District of California. Two days later, Ericsson brought this very interesting FRAND-declaration complaint in the Eastern District of Texas (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 15-01-14 Ericsson Complaint Against Apple on Scribd" href="https://www.scribd.com/doc/252684621/15-01-14-Ericsson-Complaint-Against-Apple" style="text-decoration: underline;" >15-01-14 Ericsson Complaint Against Apple</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/252684621/content?start_page=1&view_mode=scroll&access_key=key-OJe72oaAFmTUQp64Mxnb&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_21514" width="100%" height="600" frameborder="0"></iframe><p>In the past, FRAND rate determinations were requested by implementers of standards (Microsoft/Motorola, Apple/Motorola, Huawei-ZTE/InterDigital). This is the first such case, at least the first high-profile case, in which the patent <i>holder</i> goes to a court and requests this kind of ruling.</p><p>It may be tactics, but Ericsson does exude confidence in the defensibility of its royalty demands by triggering the FRAND rate determination process instead of waiting for Apple to do it at some stage of a patent infringement proceeding.</p><p>What's much clearer is that we're going to see a venue fight, and Apple filed first, which means Ericsson is going to need some really strong arguments to avoid formal or factual consolidation of its FRAND declaration suit with the California case. The venue could make quite a difference here. Not only are the Northern California judges less patentee-friendly in my observation than their colleagues in East Texas but Silicon Valley juries are particularly likely to buy Apple's innovation story. I'm not based there but, frankly, I also look at Ericsson as one of those companies, like Nokia, that were way too bureaucratic, technocratic, and unimaginative to deliver a mobile computer and useful mobile Internet device to consumers over all those years, so the world really needed the iPhone revolution for the sake of progress.</p><p>Despite the fact that consumers the world over have far more reasons to thank Apple than to thank Ericsson, I want to be rational and Ericsson's innovation story is a pretty good one, too. It can legitimately claim that it still spends billions of dollars every year on research and development (it no longer builds mobile handsets, but is still big in infrastructure), and in its complaint it lists the following accomplishments, most of which go back such a long time that the related patents have expired:</p><ul><li><p>"in 1878, Ericsson sold its first telephone;</p></li><li><p>in 1977, Ericsson introduced the world's first digital telephone exchange;</p></li><li><p>in 1981, Ericsson introduced its first mobile telephone system, NMT;</p></li><li><p>in 1991, Ericsson launched 2G phones on the world's first 2G network;</p></li><li><p>in 1994, Ericsson invented Bluetooth;</p></li><li><p>in 2001, Ericsson made the world's first 3G call for Vodafone in the UK; and</p></li><li><p>in 2009, Ericsson started the world's first 4G network and made the first 4G call."</p></li></ul><p>Ericsson does deserve respect for all of that. Whether the license fees it wants Apple to pay are excessive may have to be determined in court. While a settlement between these companies is fairly likely to happen before a judicial decision, Ericsson, based on its behavior, may be the most demanding one of the major wireless patent holders and Apple has a lot at stake here financially just because of its huge revenues. So it really could be that pre-trial discovery and motion practice won't provide these parties with enough guidance, and one or more decisions may really be needed.</p><p>Paragraph 35 from Ericsson's complaint makes some general allegations about Apple's behavior and how it compares to that of its competitors:</p><blockquote><p>"The parties' licensing negotiations have been unsuccessful because Apple refuses to pay a FRAND royalty corresponding to those paid by its competitors for Ericsson's Essential Patents. Apple fails to honor the fact that FRAND licensing is a two-way street, requiring not only that the licensor is fair and reasonable in providing licensing terms, but also that the licensee negotiates in good faith and accepts FRAND terms when they are offered."</p></blockquote><p>Apple may be the most difficult company to sell a SEP license to, but it's a fact that Apple's competitors that have taken a license from Ericsson haven't always done so without a fight. Ericsson and Samsung <a href="http://www.fosspatents.com/2014/01/ericsson-receives-nine-figure-royalties.html">settled only after failed renewal talks had resulted in litigation</a>. Still, that deal helps Ericsson now. If any U.S. court (be it a judge or a jury; be it in California, Texas, Washington DC or elsewhere) determined that held that Apple should pay lower royalties (relative to volume) to Ericsson than Samsung, the protectionism question would inevitably come up. It would look like the United States allows Apple to get away with an unusual unwillingness to license SEPs.</p><p>Ericsson tends to enforce its patents pretty aggressively in different parts of the world. I've seen them demand rather high (though clearly sub-Motorola) royalties over WiFi patents in Germany, and India's antitrust regulator <a href="http://www.fosspatents.com/2014/01/competition-commission-of-india.html">opened two investigations of Ericsson's demands in FRAND licensing negotiations</a>. Also, a document I discovered about a year ago <a href="http://www.fosspatents.com/2014/01/ericsson-explained-publicly-why-its.html">explains why Ericsson prefers to sue device makers rather than do license deals with chipset makers like Qualcomm</a>.</p><p><i>Apple v. Ericsson</i> is definitely a perfect match when it comes to FRAND licensing. Billions of dollars--probably many billions--are at stake. But it's just about money and not about a strategic conflict between direct competitors. By now it's clear that patent holders who thought to protect or gain market share through patent assertions <a href="http://www.fosspatents.com/2014/10/analysis-of-222-smartphone-patent.html">have been unable to achieve such goals, let alone to wage "thermonuclear war,"</a> but there still are some financial issues left to be sorted out in the industry, such as <i>Apple v. Ericsson</i>, and some will have to be rediscussed from time to time as existing agreements expire.</p><p>Other industry players are interested in more or less zero-zero cross-license agreements, which is what I believe the <a href="http://www.businesswire.com/news/home/20141216005300/en/Google-Verizon-Enter-Global-Patent-License-Agreement">Google-Verizon deal announced in December</a> is about. Google has done various such deals, including with Cisco, Samsung, and <a href="http://www.fosspatents.com/2014/11/android-partners-google-and-lg.html">LG</a>. But that's the way Google and some other companies would like it to work. Ericsson is different. Patent licensing is increasingly important to its business.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-11408096199904179052015-01-12T15:40:00.001+01:002015-01-12T15:46:42.056+01:00Supreme Court wants U.S. government to weigh in on Google's petition to hear Oracle's Android-Java copyright case<p>The Supreme Court of the United States had <a href="http://www.supremecourt.gov/Search.aspx?FileName=/docketfiles/14-410.htm">put</a> Google's <a href="http://www.fosspatents.com/2014/10/googles-supreme-court-petition-in.html">petition for writ of certiorari</a> (request for Supreme Court review) in Oracle's Android-Java copyright case on its list of items to be discussed at the Friday (January&nbsp;9) conference. The <a href="http://www.supremecourt.gov/orders/courtorders/011215zor_3e47.pdf">list of decisions</a>, which was just released this morning, indicates that the top U.S. court has not made a decision yet. Instead, "[t]he Solicitor General is invited to file a brief in this case expressing the views of the United States."</p><p>In my two previous posts on this case, I <a href="http://www.fosspatents.com/2015/01/google-denies-that-it-wants-to-take-all.html">explained why I don't consider</a> Google's proposed distinction between allegedly non-copyrightable header and potentially-copyrightable non-header code to be workable, and noted that the software industry at large <a href="http://www.fosspatents.com/2014/12/deafening-silence-from-software.html">philosophically opposes Google's petition</a>.</p><p>Only about 1 in 100 cert petitions succeeds. But Google apparently hopes that a well-orchestrated (rather than organic) amicus brief campaign (<i>see</i> <a href="http://www.fosspatents.com/2014/12/deafening-silence-from-software.html">1</a>, <a href="http://www.fosspatents.com/2015/01/google-denies-that-it-wants-to-take-all.html">2</a>, <a href="http://www.fosspatents.com/2014/11/buy-one-get-two-free-effs-approach-to.html">3</a>, <a href="http://www.fosspatents.com/2014/11/yawn-amicus-briefs-in-support-of.html">4</a>) will persuade the top U.S. court to hear the case.</p><p>The Supreme Court appears unconvinced for now that this case really needs to be heard (otherwise it could have decided based on the submissions it already has on file), but in light of Google's amicus brief campaign it apparently wants to double-check whether there really <b><i>is</i></b> a key issue at stake here for innovation. That's why the U.S. government is asked to chime in. Google is known to have excellent government relations, but I'm sure the Department of Justice is absolutely aware of the extent to which the software industry--which is so important to U.S. economic growth and employment--depends on <b><i>legal certainty</i></b> with respect to software IP protection. A decision to grant certiorari <a href="http://www.fosspatents.com/2015/01/google-denies-that-it-wants-to-take-all.html">would create enormous uncertainty since Google wants to raise the general question of whether program code, no matter how creative, expressive, original or sizeable, can be devoid of copyright protection</a>. It would be downright irresponsible for the U.S. government to support Google's cert petition because it would discourage investment in software development at least until the case is resolved and, if anything goes wrong, for a very long time. I'm sure <a href="http://www.fosspatents.com/2014/12/deafening-silence-from-software.html">the software industry at large, which is firmly on Oracle's side here</a>, will convey that message to its government.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-89688903716322788442015-01-08T07:21:00.000+01:002015-01-08T08:58:51.007+01:00Competing device makers HTC and LG join Google, SAP in backing Samsung against Apple<p>Apple, Samsung and Google are three of the most significant members of an <a href="http://www.fosspatents.com/2014/11/near-automatic-injunctions-raise.html">industry coalition that is fighting the good fight for balanced rules of procedure for Europe's future Unified Patent Court</a>, particularly with respect to access to injunctive relief. But as the industry coalition stated repeatedly, including at the November 2014 hearing, some of its members are actually embroiled in patent litigation--in which they have sought or are seeking injunctions--with each other. That fact only adds to the credibility of that industry group because it shows that some of its members, such as Apple, are more interested in obtaining sales bans over patents than others, such as Google and Samsung, <i>yet</i> they all agree that the <a href="http://www.fosspatents.com/2014/11/draft-rules-for-european-patent-court.html">current proposal</a> would make Europe a patent trolls' paradise and hurt all innovative operating companies. Nothing could better demonstrate just how bad those proposed rules are.</p><p>The most notable case in which members of the UPC industry coalition stand on opposing sides is Apple's appeal of Judge Lucy Koh's August&nbsp;2014 <a href="http://www.fosspatents.com/2014/08/judge-denies-apple-bid-for-sales-ban.html">denial of a permanent injunction against Samsung over the patents on which Apple had prevailed at the spring&nbsp;2014 trial</a>. Apple says that a feature-specific injunction should be granted here and claims to have better evidence in place this time around (Apple filed a <a href="https://de.scribd.com/doc/252005983/15-01-05-Apple-Reply-Brief-in-Appeal-of-Denial-of-Injunction">reply brief</a> this week that reinforces the points made in its <a href="http://www.fosspatents.com/2014/10/apple-fighting-samsung-in-two-us-courts.html">opening brief</a>) but Samsung <a href="http://www.fosspatents.com/2014/12/samsung-argues-apple-still-cant-tie.html">argues that Apple still can't tie patented features to lost sales</a>. Google sides with Samsung on this and has, together with other significant companies (LG, HTC, SAP, Red Hat, Rackspace), asked the Federal Circuit for permission to file an amicus curiae brief.</p><p>Apple formally opposes the proposed filing, noting that Google accepted to indemnify Samsung with respect to certain patents. However, no liability was established with respect to those patents, and as a result, they are not at issue in this injunction appeal. Apple also points to various business relationships between Google and some of the other amici curiae, even including some small-scale business partnerships compared to which there's actually a much closer cooperation between Apple and Samsung in certain (component-related) areas. Notably, HTC and LG compete with Samsung, and since HTC has a ten-year license agreement in place with Apple, it has no reason to be concerned about the particular patents at issue here.</p><p>I've seen LG enforce some of its patents (such as patents on the Blu-ray standard) rather aggressively.</p><p>There have also been some other filings. Industry group CCIA and the National Black Chamber of Commerce filed other briefs in support of Samsung, while Apple's pursuit of an injunction is backed by Ericsson and Nokia, two companies that used to build smartphones but exited that business and increasingly focus on patent licensing (and that are obviously <i>not</i> members of the aforementioned UPC industry coalition). While it's certainly good for Apple to have at least <i>some</i> support from third parties, the fact that no <i>current</i> smartphone maker was prepared to back Apple here shows that Cupertino is somewhat isolated in its industry when it comes to this issue. They all face too many patent assertions all the time and have to think about their interests as a defendant, even if they engage in some enforcement (Microsoft, for example). And there could be a future situation in which Apple itself will fight an injunction bid against its products and someone else will use Apple's own pro-injunction arguments against it.</p><p>I'm not an expert in the admissibility of amicus curiae briefs, so I can't predict whether Google itself will be formally allowed to appear as a "friend of the court" here, but there cannot be the slightest doubt about the other filers.</p><p>It's an interesting brief that this blog is first to make available to the general public (access is still restricted on the Federal Circuit docket; this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-12-24 Google HTC LG Rackspace RedHat SAP Amicus Brief on Scribd" href="https://www.scribd.com/doc/252006185/14-12-24-Google-HTC-LG-Rackspace-RedHat-SAP-Amicus-Brief" style="text-decoration: underline;" >14-12-24 Google HTC LG Rackspace RedHat SAP Amicus Brief</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/252006185/content?start_page=1&view_mode=scroll&access_key=key-BlY3jccBDT58svCTeLbI&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_95789" width="100%" height="600" frameborder="0"></iframe><p>The amicus brief focuses on the bearing of a certain <a href="http://www.fosspatents.com/2013/05/federal-circuit-has-set-stage-for.html">Federal Circuit decision from 2013, <i>Douglas Dynamics</i></a>, on the present case. In that case, which involved two snowplow manufacturers, then-Chief Judge Randall Rader stressed that if a workaround is available, an infringer should choose the path of legality. At the time I thought this was going to be very helpful to Apple (at that time, in connection with its first California case against Samsung, while the current appeal relates to the second case). But it turned out that it didn't help Apple too much. Smartphones and snowplows are different markets with different characteristics, and there's obviously a much smaller number of features in a snowplow than in a smartphone. While Apple won a remand of the denial of a permanent injunction in that first Samsung case, Judge Koh <a href="http://www.fosspatents.com/2014/03/setback-for-apple-us-judge-denies.html"><i>again</i> (while taking into account the additional guidance from the Federal Circuit) denied an injunction</a>. Last summer Apple <a href="http://www.fosspatents.com/2014/07/apple-drops-cross-appeal-forever.html">dropped its related cross-appeal and, thereby, forever accepted that denial</a>.</p><p>The above amicus brief has two parts. Section A explains that Apple still has to establish a causal nexus between the infringements identified (Samsung is appealing those findings, by the way) and the alleged irreparable harm, regardless of the scope of the injunction it is seeking. In other words, the standard isn't lowered just because a proposed injunction wording is very specific to particular features. That makes sense and may be part of the reason why Apple tries to reduce the credibility of that amicus brief, but I'm now going to focus on Section&nbsp;B, which addresses Apple's argument that <i>Douglas Dynamics</i> supports its injunction push now (though it didn't help in the previous case).</p><p>The "causal nexus" question never came up in <i>Douglas Dynamics</i>. That's the primary reason for which it didn't help Apple before and may not help now. According to the amicus brief (and I'm obviously not able to verify this), "Douglas's patents were directed to an entire snowplow blade assembly, not a specific feature of that assembly." The brief goes on to discuss another key difference from the Apple-Samsung dispute:</p><blockquote>"Second, the core innovation of Douglas's patented snowplow design allows a user to easily remove the assembly, reducing stress on the vehicle's suspension. [...] Douglas promoted this 'easy on, easy off' feature in advertising for its own snowplow assemblies by incorporating the concept into its trademark – Minute Mount – to ensure that snowplow customers associate the patented feature with Douglas. [...] Here, there is no evidence that the patented features are core innovations of Apple’s products or that Apple has advertised them as such. Apple certainly has not incorporated those features into its product brand names."</blockquote><p>As for the last part, the iPhone is certainly not sold or advertised as the "slide-to-unlock phone" or the "quick-links phone."</p><p>The brief also says that "Douglas never licensed the patents-in-suit and intentionally chose not to, thus insuring that the innovative design would (absent infringement) be exclusively associated with Douglas in the minds of its customers," and contrasts this no-outbound-licensing-ever approach with the fact that "Apple has licensed the patents-in-suit to several competitors, including IBM, Nokia, HTC and Microsoft." I would agree with the amici that "there is simply no evidence that anyone exclusively associates the patented features with Apple," with the exception that Apple's particular implementation of slide-to-unlock, with the slider bar, is certainly a signature feature, but Apple didn't even accuse the more recent products at issue in this case (and those are already a couple years old) of infringement of its slide-to-unlock patent. In the prior art context it has been stated over and over that <a href="http://www.fosspatents.com/2014/04/10-european-judges-found-apple-had-not.html">the iPhone was <i>not</i> the first phone to come with a slide-to-unlock mechanism</a>, which is why the related patent family is so weak. With respect to "quick links," that's a feature that consumers typically can't distinguish from other links, such as the ones found on a webpage like this. And autocomplete is also something that you find in all products from all sorts of vendors.</p><p>A key concern of the amici is that the way Apple would like <i>Douglas Dynamics</i> to be applied to cases like this one "would unfairly create a lower standard for proving causal nexus for companies with a reputation for innovation." Apple argues that <i>Douglas Dynamics</i> made the patent holder's reputation as an innovator a key factor. The amici concede that there is direct competition between Apple and Samsung, and that Apple has a reputation as an innovator, but say that evidence is "scant, at best," with respect to claims that Samsung has a less prestigious reputation, that Apple makes efforts to maintain exclusive control over its patented features, and that an injunction was necessary to demonstrate to consumers that Apple does protect its intellectual property rights.</p><p>Against this background, the amicus brief says:</p><blockquote><p>"So the proposed '<i>Douglas Dynamics</i> test,' as Apple has framed it, is this: if a patentee has a reputation for innovation and its patent is infringed by a competitor, then the patentee's reputation will <i>necessarily</i> be harmed by that infringement – no matter how trivial the patented feature – because consumers <i>might</i> believe the patentee did not enforce its intellectual property rights. No further proof of causal nexus is needed. The logical leap is astounding."</p></blockquote><p>The appellate hearing will take place in a matter of months, and I'll listen to the official recording as soon as it becomes available (usually on the day of the hearing). I understand Apple's desire for a sales ban and I said before that, while Samsung doesn't need to infringe the related patents (and the liability findings are subject to an appeal, with <a href="http://www.fosspatents.com/2014/08/us-patent-office-rejects-apples.html">the autocomplete patent also being under reexamination pressure</a>), an injunction would make Apple look and feel better. However, it wouldn't make sense to lower the standard for access to injunctive relief if an injunction bid comes from a company with a reputation for innovation. In Apple's case, that reputation is based on a definition of innovation that is inconsistent with the one applied in patent law. In patent law, it's about who's first to come up with something, not who's first to convince millions of consumers to buy and use technologies that, for the most part, others created before Apple.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-60641415084787891382015-01-08T04:39:00.000+01:002015-01-08T14:35:44.335+01:00Pressure mounts on EPO president and administrative council over suspension of patent judge<p>About a month ago, <a href="http://www.fosspatents.com/2014/12/government-delegates-express-concern-at.html">the Administrative Council of the European Patent Organisation</a>, the international body running the European Patent Office, expressed "concern at an incident unique in the history of [the] EPO" without saying clearly whether this related to the controversial decision by EPO president Battistelli to "suspend" a member of a board of appeal (a judge in all but name) for disciplinary reasons <i>or</i> whatever the suspended judge might have done. I believe that this ambiguity was intended because the Administrative Council needs to keep all options open, as it may ultimately have to oust the president over this scandal. However, I learned later that EPO staff was told the Administrative Council took issue with the alleged misconduct of the suspended judge. The Administrative Council plays a key role in the "reign of terror" that tries to discourage EPO staff, including judges, from fighting for basic human rights and one of the most fundamental values of the civilized world: judicial independence.</p><p>If the Administrative Council of the EPO didn't believe that it can get away with things that other political bodies couldn't even dream of committing, the EPO would already have a new president (though, as I said more than once, the real issue here is a <i>structural</i> one) and it would also be unthinkable in other public organizations that a <a href="http://techrights.org/2015/01/04/rikard-frgacic-on-zeljko-topic/">vice president faced with multiple criminal charges</a> (also see <a href="http://techrights.org/2014/11/16/six-criminal-lawsuits-against-zeljko-topic/">this "special report" on criminal charges</a>) could stay in office for this long. All of this shows that something is completely wrong with the Administrative Council itself. Instead of exercising oversight, that body is largely responsible for the banana republic that the EPO has become. Seriously, there is no way that, for example, someone could continue as a vice president of a national antitrust authority, national patent office, or a central bank--except in the Third World--under these circumstances. While everyone is innocent until proven guilty in court (and it's possible that Mr. Topic never committed any wrongdoing that can be proven), a certain amount of smoke is equivalent to fire in a political context. Except, of course, if the decision makers feel they are not going to be held accountable.</p><p>According to <a href="http://www.lesechos.fr/journal20141212/lec2_industrie_et_services/0204009171427-tensions-a-loffice-europeen-des-brevets-1074346.php">French financial daily Les Echos</a>, the suspended EPO judge's alleged wrongdoing relates to whatever he may have said about Mr.&nbsp;Topic, viewed by the EPO president as a "defamation campaign." I don't know what exactly the suspended judge said, but this looks like someone merely exercising his freedom of speech. The IPKat blog <a href="http://ipkitten.blogspot.de/2015/01/judicial-independence-europes-ip-judges.html">published a letter from the Intellectual Property Judges' Association (IPJA) to the Administrative Council</a>, and the letter had "near unanimous support" from the IPJA's membership, which means top-notch patent judges from 11 European countries, without any objection or reservation. That letter says about the suspended judge's alleged misconduct: "It is not, as far as we know, suggested that the Member has committed any criminal offence."</p><p>The judges call for political action:</p><blockquote><p>"The present events seriously threaten the judicial independence of the Boards of Appeal and by doing that call in question the guarantee of an independent and impartial review of the European Office's decisions by a judicial body. Not tolerating that should be the common interest of all Member States of the European Patent Organisation."</p></blockquote><p>Having watched various political scandals over the years, I consider it a rule of thumb that an affair that results in statements and actions even during the Holiday Season, and that continues with undiminished force after the Holiday Season, tends to result in someone's resignation or ousting. Smaller issues go away and are not carried over into the new year. But the really big issues do survive the Holiday Season.</p><p>Even on December 29, at a time when few people are at work, there was a very significant development. EPLAW, the European Patent Lawyers Association, wrote a <a href="http://www.eplawpatentblog.com/files/eplaw_letter_29_december_2014.pdf">letter to the members of the Administrative Council</a> expressing concern over judicial independence at the EPO. My favorite part is the seventh paragraph:</p><blockquote><p>EPLAW is of the opinion that [...] judicial independence is guaranteed only when the power to suspend or to remove a judge is with his peers, and not with an executive or administrative body. In this respect Article 11(4) EPC -- which provides the Administrative Council with the power to exercise disciplinary authority over the members of the [boards of appeal] -- falls short.</p></blockquote><p>In the final paragraph, EPLAW therefore "urges the Council to use this opportunity to propose an amendment to Article 11 EPC and in any event to critically review the Guidelines for Investigation [the basis on which the suspension happened] so as to avoid any further concern with respect to the principle of judicial independence at the EPO."</p><p>Thanks to the <a href="http://ipkitten.blogspot.co.uk/2015/01/developments-at-european-patent-office.html">IPKat blog</a> I've become aware of an official response by the UK Government to a member of parliament (liberal democrat <a href="http://en.wikipedia.org/wiki/Julian_Huppert">Dr. Julian Huppert</a>, from Cambridge) who asked a question about what measures would be taken to ensure judicial independence at the EPO. The <a href="http://www.parliament.uk/business/publications/written-questions-answers-statements/written-questions-answers/?page=1&max=20&questiontype=AllQuestions&house=commons%2clords&member=3931">answer</a> suggests that the UK government and possibly some other governments do see a need for some improvement:</p><blockquote><p>Officials in the UK Intellectual Property Office are closely and actively involved in discussions relating to the Boards of Appeal of the European Patent Office (EPO), including the Enlarged Board. It is the UK Government position that the Boards of Appeal should be independent of the executive of the EPO, and be seen to be so. This view is shared by other EPO member states and we expect proposals to make this clearer to be considered by the Administrative Council, the Office's supervisory body, in March 2015.</p></blockquote><p>Whether the proposed reforms will go far enough, and whether they will be implemented at all, remains to be seen. I felt last month that there was a crack in the shell, and the UK government's response reaffirms this belief. Let's hope for the best.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-55995066288692741072015-01-02T13:45:00.000+01:002015-01-02T17:14:11.172+01:00Google denies that it wants to take all software copyright down with its Supreme Court petition<p>Happy New Year!</p><p>This is the follow-up I announced in my <a href="http://www.fosspatents.com/2014/12/deafening-silence-from-software.html">Wednesday blog post</a>, "Deafening silence from software industry presents credibility problem for Google's Supreme Court petition."</p><p>Before I talk about a substantive issue concerning Google's petition, let me add something to what I wrote the day before yesterday about an orchestrated rather than organic amicus brief campaign. California-based inventor and IP lawyer John Nicholas Gross looked at the 77 "amici" who signed the EFF's computer scientists brief. On Twitter he commented on one after the other, and if you scroll down far enough on his <a href="https://twitter.com/JNGross/">Twitter page</a> (to his November 9 tweets), you can find more detail on this. His analysis culminated in <a href="https://twitter.com/JNGross/status/531501796271730688">this overall result</a>:</p><blockquote><p><b>"Final scorecard: 35 of 77 EFF 'amici' [are] current/ex GOOGLE, received funding, work for orgs that get funding, or have biz deals w/ GOOGLE"</b></p></blockquote><p>Almost two and a half years ago, there was a great deal of interest in business relationships between the parties to this dispute and commentators such as bloggers, including yours truly (who took the very same position on interface-related copyrightability in public more than 10 years ago and also about five years ago while working <i>against</i> Oracle). However, no one besides Mr.&nbsp;Gross has recently found it worthwhile to research the connections between those "friends of the court," about half of which are easily identifiable as Google friends. Instead, certain journalists (fortunately only a very few) have worked hard to describe those computer scientists as <i>the</i> authority on the issue. Well, even if you would like the the law to be what those guys say, it's not journalism but downright propaganda to overstate the importance of that filing without doing your <b><i>homework</i></b>. If you are real, serious journalists, why can't you do what Mr.&nbsp;Gross has done and simply run some Internet searches--Google searches, that is--to track down all those connections? So much for that.</p><p>On the substantive side, there's only one thing in Google's reply brief (published in my previous post) that I wish to discuss. Other than that, unless anything important comes to my mind or something interesting happens, I'll just wait for the Supreme Court's decision on the cert petition.</p><p>The one thing that is key here (other than Google's emphasis of the favors it received from its best friends in the form of signatures) is the question of what effect Google's proposal to hold 7,000 lines of highly-creative and highly creatively-structured declaring code uncopyrightable (as the district judge mistakenly did in an unprecedented outlier ruling) would have on software copyright as a whole. As an app developer who has written a lot of code himself and has recently hired four full-time developers, I'm obviously interested in a reasonable degree of IP protection for software. While I applaud Google for fighting in certain areas against the (sometimes institutionalized) excesses of the patent system, I view Google's attack on software copyright as an attack on every honest (<i>i.e.</i>, non-thief) software developer in the world.</p><p>In its reply brief, Google still--after all those years--fails to make a workable line-drawing proposal. It just denies the undeniable: that an overreaching application of the §120(b) exclusion of systems and methods of operation from the scope of copyright would create enormous uncertainty about the copyrightability of <i>any</i> software, <b><i>at least</i></b> of all object code (since object code does not contain source code comments).</p><p>Google says in its reply brief "that the Java libraries of pre-written programs are generally eligible for copyright protection, but the method headers (also known as declarations) used to operate those programs are not." While this appears, at first sight, to be a line-drawing suggestion, it's utterly unhelpful once you think it through: the distinction between declaring code and other code makes no sense under software-related copyright law.</p><p>Google claims that the exclusion of systems and methods of operation applies to method headers in a very broad sense. According to Google's reply brief, it doesn't depend on any fact-specific determination. Ineligible. End of story. But Google's lawyers know that the Supreme Court would reject a petition for writ of certiorari that overtly advocates the unconstitutional abolition of software copyright as a whole. So they included the "don't worry" message I just quoted. But software developers <i>would</i> have to worry if the Supreme Court ever considered agreeing with Google.</p><p>Throughout this litigation, Google has always argued that whatever was presented wasn't copyrightable. Not just declaring code. Not just the nine-line rangeCheck function (which even the district court held copyrightable, quite tellingly). Even a bunch of decompiled programs that consist mostly of non-header code <a href="http://www.fosspatents.com/2012/05/judge-holds-google-to-infringe-8-more.html">were held copyrightable, though Google said they were not</a>. I have yet to see the first piece of software that Google agrees is copyrightable--except for the closed-source parts of Android, of course. Google does make it clear to Android device makers that it will enforce its copyright in those programs should anyone copy them without a license. But those are not at issue in this dispute.</p><p>I've really tried very hard to understand whether Google's proposal could be workable, and I just can't see how it would ever work. I can't see how anything good could come out of this Supreme Court petition for Google without causing massive damage to the software industry--including little guys like me--as a whole.</p><p>Let's think it through together. When lawmakers decided that software would be protected by copyright law just like literature, they made a policy judgment that is now binding on everyone, even on the Supreme Court. It has been clear ever since that not only program source code, which may contain expressive elements such as names and commentary that are not needed for functional purposes, but also <b><i>object code</i></b> stripped of those optional though expressive elements is protected by copyright law.</p><p>It makes for a much more focused analysis if we start from that premise: while §102(b) excludes systems and methods of operation from the scope of copyright, even object code that is by definition functional--it's the code you can actually run on your computer--does deserve and enjoy copyright protection provided that it's original.</p><p>That premise, in and of itself, makes it very clear that §102(b) is meant to protect only against overreaching interpretations of copyright law. Someone who writes a book about an accounting system doesn't own the accounting methods. Someone who publishes a game, or a book on game rules, can't monopolize a method of gameplay. Those questions were decided a long time ago and have nothing to do with the literal copying of 7,000 lines of highly-creative code. Of course, if copyright law allowed someone to monopolize an accounting method or a game category, then software copyright would be like broad and trivial software patents on steroids. Again, understood and agreed. But that's not the issue here.</p><p>Google could have designed an API with the same technical characteristics as the Java API without infringing copyright. It would just have had to come up with its own interface. As a result, programmers would have had to learn the new interface, but that would have been Google's problem (when it needed to get traction for Android among developers), not Oracle's.</p><p>Oracle never said that you couldn't have an API that allows you to rename files, to draw rectangles, or to terminate threads, without taking a license to Java. So this has nothing do with cases like <i>Baker v. Selden</i> (the one involving the accounting method).</p><p><b><i>Essentially, Google is saying that <u>header code</u> is inherently, and without a need to consider the facts, a system or method of operation, while <u>other code</u> may or may not be depending on the facts.</b></i></p><p>If you look at this through the lens of "no matter what §102(b) says, even object code stripped of variable names and source code comments must remain eligible for copyright protection because that's the way Congress and all courts wanted it to be," then there's really no basis on which one can consider header code to be, inherently, a system or method of operation without saying the same about all other code. That's the whole problem.</p><p>In order to illustrate this, I'm now going to walk you through a couple of code segments that the district court held copyrightable (against Google's non-copyrightability arguments) and discuss, from the §102(b) angle, the difference between headers and other code, just to show you that the distinction is nonsensical in a copyrightability context.</p><p>Let's start with the nine-line rangeCheck function (without the usual indents, just to make it easier to read here):</p><blockquote>private static void rangeCheck(int arrayLen, int fromIndex, int toIndex) {<br>if (fromIndex &gt; toIndex)<br>throw new IllegalArgumentException("fromIndex(" + fromIndex + ") &gt; toIndex(" + toIndex+")");</br>if (fromIndex &lt; 0)</br>throw new ArrayIndexOutOfBoundsException(fromIndex);</br>if (toIndex &gt; arrayLen)</br>throw new ArrayIndexOutOfBoundsException(toIndex);<br>}</blockquote><p>The header--and thus non-copyrightable part according to Google--would be everything that's in the first line before the opening brace. The rest would be eligible for copyright protection (though Google said this particular code segment wasn't worthy of copyright protection for other reasons than being a header; essentially, Google said it was way too small to be copyrightable).</p><p>I'm obviously not saying that the first line on its own would be copyrightable in isolation. But that's not because it's a header. I'd have an even bigger problem with any of the other lines if someone tried to copyright them on their own. Just like copyrightable music consists of non-copyrightable notes and this blog post as a whole is copyrightable while none of the 26 letters used in its are, you can always break down a copyrightable work to the level of uncopyrightable atoms.</p><p>So it typically (with the exception of some unusually creative single lines of code) takes a set of lines--in this case, nine lines--to identify a copyrightable work. But why would the header in this case have to be completely ignored in this analysis while the rest would at least have to be looked at?</p><p>It makes no sense if you look at what each line does. If the header is excluded under §102(b), so is the rest. If the rest is not excluded, then the header--and, as a result, a reasonably creative and large set of headers--isn't excluded either. It sounds simple because it is.</p><p>If any other code--non-header code--wanted to call the rangeCheck function, an exemplary line of code would be this:</p><blockquote><p>rangeCheck(listLength, firstIndex, lastIndex);</p></blockquote><p>That would be code <i>making use of</i> the header. It wouldn't be header code. If anything, <i>that</i> code, because it triggers the execution of the rangeCheck code, would be more of a system or method of operation than the rangeCheck header ever was.</p><p>The body of the rangeCheck function consists of two instructions that have a simple pattern: if a condition is met, an exception is thrown. Why would the "if" part that results in a comparison of actual numbers, or the "throw" part that triggers an exception (<i>i.e.</i>, the program may stop executing, or at least there would have to be some exception handling that organizes an orderly retreat after an error came up), be less of a system or method of operation than the header? I just can't see that.</p><p>Sure, this was just rangeCheck. A very small function. Still, copyrightable in the opinion of the court(s) below. But we won't reach a conclusion more favorable to Google's position even if we compare header lines to non-header lines from larger programs. Let's look at one of the <a href="http://www.fosspatents.com/2011/01/new-evidence-supports-oracles-case.html">aforementioned decompiled files</a> (that were also held copyrightable against Google's representation that they were not). The first one of those programs is <a href="http://www.docstoc.com/docs/69702407/1-AclEntryImpl-synopsis">AclEntryImpl</a>. We won't discuss every line, just the <i>categories</i> of lines of non-header code.</p><p>The "package" command at the beginning is about defining namespaces. Since it's only one line, we don't have to waste time discussing whether or not this is header code. There's certainly a case for a "package" command being header code. But the "import" commands that follow have the effect of importing other namespaces for easier references. So, for example, if you have a namespace that is called mynamespace.tools.filemanagement and it comes with a compressedFileArchive class, then you can either reference that class by writing mynamespace.tools.filemanagement.compressedFileArchive each time you make use of it, or if you think you're going to use this one (and/or other classes from the same namespace) frequently, you may just import that namespace and then you can reference compressedFileArchive directly (unless another class by that name is also found in, or has been imported into, your namespace, in which case you need to specify which one you mean).</p><p>Then we get to what is undoubtedly a header line the way Google defines it:</p><blockquote><p>public class AclEntryImpl implements AclEntry</p></blockquote><p>The part inside the braces is code that gets executed when AclEntryImpl is called. And the first three lines of that inside part are:</p><blockquote><p>private Principal user;</br>private vector permissionSet;<br>private boolean negative;</p></blockquote><p>Those three lines declare (define, create) a variable of data type "Principal" named "user," a variable of data type "vector" named "permissionSet," and a variable of type "boolean" (it's binary; true or false) named "negative." So here you have declaring code of the kind that Google says is not copyrightable if it's in a header file, but Google says code that is not in a header-only file may be copyrightable. Remember, Google's reply brief says "that the Java libraries of pre-written programs are generally eligible for copyright protection, but the method headers (also known as declarations) used to operate those programs are not." Those "private" commands (they define a variable that is available only at the local level and can't be accessed from outside) are, however, part of the pre-written program code that gets executed when you instantiate the AclEntryImpl class (<i>i.e.</i>, make use of the header in order to create an object based on the class definition).</p><p>If we believe that such declarations must be copyrightable, then we already disagree with Google. If we say, only for the sake of the argument, that this kind of code shouldn't be copyrightable, then we <i>must</i> disagree with Google shortly thereafter.</p><p>The very next line--"public AclEntryImpl(Principal principal)"--is the declaration for the constructor, <i>i.e.</i>, for the code that creates an object based on a class definition. And the executable (non-declaring) constructor code consists only of these four lines:</p><blockquote><p>user = null;<br>permissionSet = new Vector(10, 10);<br>negative = false;<br>user = principal;</blockquote><p>Why would this constructor code not be excluded under §102(b) if the headers and even the "private" declarations are? Again, it makes no sense.</p><p>Those four lines assign a value to each of three variables. The "user" variable is initially assigned "null", a value that means "not available." Then, at the end of the constructor, it's assigned the content of the "principal" variable, which is the only parameter of the constructor (<i>i.e</i>, the only value passed on to the constructor when it is called). It makes no sense to have two assignments in the same block of code because the second one undoes the first one and no use is made of the assigned value in the meantime; the reason it's here at all is that a decompiler (a program that creates source code based on object code) was at work, and decompilers typically aren't smart enough to identify such inefficiencies. So technically, we have just three assignments of values to variables. Each variable is like a predefined storage place for information. Each such storage place gets some content, and then constructor is done. This is not declaring code, but wouldn't you agree that <i>assignments</i> look pretty much the same as <i>declarations</i>?</p><p>They do, and in fact, most programming languages allow developers to mix them: you can declare a variable and immediately assign an initial value to it. Or, if you have so-called constants, you <i>must</i> assign a value at the beginning and that value won't ever change while the program is being executed.</p><p>The absurdity of Google's proposition "that the Java libraries of pre-written programs are generally eligible for copyright protection, but the method headers (also known as declarations) used to operate those programs are not" is shown, not only but particularly clearly, by the fact that Google wants the very same thing--a declaration that comes with an immediate assignment--to be ineligible for copyright protection if it's in a header file but potentially copyrightable, depending on the specific facts, if it's found inside a block of non-header code. "Absurdity" is an understatement. No reasonable person could ever claim that copyrightability depends on <i>where</i> a particular line is found. Musical notes are equally copyrightable whether they're at the beginning or the end of a song or an entire opera. There's no rule that the prelude is copyright-ineligible. Similarly, headlines in books (Oracle's famous Harry Potter example) aren't treated differently from the body of the text. Prefaces and epilogues aren't treated differently from what's between them.</p><p>At this point it should already be clear that Google does not make a workable line-drawing proposal. It proposes a vague and arbitrary line that has no basis in the law and is completely detached from what Congress wanted when it decided that computer program code, even object code, must be copyrightable as long as it's original and expressive.</p><p>Let's continue a bit with the AclEntryImpl class definition anyway. The next header line there is "public AclEntryImpl()" and that's also a constructor, but one without any parameter. The code of this constructor is a subset of the previous constructor, the one with the "principal" parameter. This explains why the decompiler resulted in the aforementioned waste of assigning two different values to the "user" variable in the same code segment: the constructor with a parameter initially calls the one without a parameter and then just assigns the parameter value to the "user" variable. The recompiler tool that was used here simply processed each line without checking again later whether any particular line was rendered pointless by a subsequent line. But that's unrelated to the question of copyrightability. I'm just trying to make sense of something that makes no technical sense here, and that's due to the genesis of this file (decompilation).</p><p>After the two constructors, we find a boolean (true/false) function named setPrincipal. The "public boolean" line is a header; the code block within the braces is the code that gets executed when this method is invoked. The purpose of setPrincipal is to assign the value of the "principal" parameter to the "user" variable, but only if "user" hasn't been given a value before (otherwise it will return "false" to report that the attempt to assign the value has failed, a safeguard against overwriting the variable after the initial assignment and a typical write-only-once mechanism).</p><p>Why is "if(user != null)" and "return false" (to be clear, both "return" and "false" are predefined Java keywords, while the method name setPrincipal was freely chosen by the developer) any more expressive or any less functional than the declaring code? I can't see why that would be the case. I also can't see why a line that <i>calls</i> the setPrincipal function would be <i>less</i> of a system or method of operation than the line that <i>defines</i> the function.</p><p>Unless one tries to interpret the scope of copyright protection based on declaring code too broadly (like I wrote above, as a software patent on steroids), declaring code is an <i>even weaker</i> case for a §102(b) exception than non-declaring code.</p><p>This stuff isn't worth the Supreme Court's time. It's no more worthy of a Supreme Court review just because Google's friends signed some amicus briefs and got some of their friends and peers to sign. Certiorari should not become a campaigning contest.</p><p>The only way the Supreme Court could help Google here would be by creating a black hole that would absorb almost all software copyright protection, including all (no exception there) object code protection. Since the Supreme Court won't create a black hole, and since there's no basis for an interoperability exception to copyrightability in U.S. law, what good would a Supreme Court review do other than delay resolution of this case, which would come in handy for Google but not be in the public interest?</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-77260405658022272862014-12-31T11:42:00.001+01:002014-12-31T11:52:32.399+01:00Deafening silence from software industry presents credibility problem for Google's Supreme Court petition<p>Google's petition for writ of certiorari (request for Supreme Court review) in Oracle's Android-Java copyright infringement case has been distributed to the offices of the Supreme Court justices for consideration at their January&nbsp;9 conference. Oracle <a href="http://www.fosspatents.com/2014/12/oracle-effectively-says-google-jumped.html">responded to the petition on December&nbsp;8</a>, and two weeks later, Google's reply to Oracle's response was filed. It took me a while to obtain the filing. Here it is (this post continues below the document with some observations):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-12-23 Google Reply Brief in Support of Cert Petition on Scribd" href="https://www.scribd.com/doc/251378654/14-12-23-Google-Reply-Brief-in-Support-of-Cert-Petition" style="text-decoration: underline;" >14-12-23 Google Reply Brief in Support of Cert Petition</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/251378654/content?start_page=1&view_mode=scroll&access_key=key-gGGD5i9vgvkZFzK8dt6Q&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_39012" width="100%" height="600" frameborder="0"></iframe><p>Google's brief states at the very start that Oracle couldn't "dispute the exceptional importance of the question presented" and goes on to emphasize, as the document also does toward the end, "the seven amicus briefs representing the views of more than two dozen industry leaders, 77 pioneering computer scientists, numerous industry and public-interest groups, and 41 law professors."</p><p>As for importance, it's key to distinguish between different kinds of importance. Just like things can be important while not being urgent, things can be important in some ways but not in the ways that warrant a Supreme Court review. Without a doubt, the amicus briefs that have been filed here (an orchestrated, not organic outcry) will help Google get the attention of the top U.S. court. But the copyrightability of 7,000 lines of highly-creative and highly creatively-structured lines of declaring code is not important in the sense of something that needs further clarification.</p><p>Google's friends and employees, and their friends and employees, have gotten some people to sign some amicus briefs. There's a few dozen people who are upset because the Federal Circuit (rightly) disagreed with their positions including a surreal compatibility exception to copyrightability. So they're banging their heads at the next wall. But what about those who should really care: the <b><i>software industry</i></b>?</p><p>Software isn't hardware or services. Industry isn't individuals.</p><p>Google's amici are not the leading software industry players. Whatever accomplishments some individuals (some of whom I like and all of whom I respect) can point to, they don't have legal departments available to them who can explain to them how software copyright law works (and does not work). They can be misinformed and misguided. It happens all the time even to the best people.</p><p>With the greatest respect, those individuals can have opinions, political preferences and laundry lists of ways in which they'd like the law to be changed or interpreted, but they don't -- they just don't -- represent the software <b><i>industry</i></b>.</p><p>Nor do hardware and services companies. Red Hat, for example, may support Google on this and may have its own Java-related business interest in weak IP protection. But it mostly distributes or rents out software written by <i>others</i>. This is a company that monetizes software to a far greater extent than it actually creates software. Call it symbiotic if you like those guys, call it parasitic if you have a critical perspective, but no one can tell me that Red Hat is in the slightest way representative of the (U.S.) software industry.</p><p>Google's biggest credibility problem when it points to its amicus briefs is not in the briefs that were filed and in the easily-researchable connections between various signatories (for example, some of them are simply Google employees). It lies in the conspicuous absence of amicus briefs from the (real) software industry.</p><p>Apparently, companies like Microsoft, who file amicus briefs all the time but didn't do so at this particular stage of this case, have elected to treat Google's cert petition with silent contempt. That silence speaks louder than words.</p><p>It's obvious that those companies, which have made and continue to make an enormous contribution to U.S. economic growth and employment, wouldn't have supported Google. They're firmly on Oracle's side as the amicus briefs they filed with the Federal Circuit (after the district judge shocked them with an outlier decision that the appeals court fortunately reversed) <a href="http://www.fosspatents.com/2013/02/industry-leaders-creatives-academics.html">demonstrated almost two years ago</a>. Here's an alphabetical list of the industry players that supported Oracle directly or indirectly through BSA | The Software Alliance (including some that are not exclusively software makers, but even they have at least very substantial software divisions): Adobe, Apple, Autodesk, Bentley Systems, CA Technologies, CNC Software - Mastercam, EMC, IBM, Intel, Intuit, McAfee, Microsoft, Minitab, NetApp, Progress Software, PTC, Quest Software, Rosetta Stone, Siemens PLM Software, Symantec, TechSmith, and The MathWorks.</p><p>So why didn't they file amicus briefs in support of Oracle's opposition to Google's Supreme Court petition? I guess the reason is they don't see that the Federal Circuit decision was a big deal for the industry at large. The district court decision shocked them into action. The Federal Circuit opinion means business as usual. Back to normal.</p><p>I have no doubt that those kinds of companies would speak out in support of Oracle's position again should the Supreme Court grant Google's petition because what Google tries to achieve here, though it is a long shot, is the opposite of what has so far enabled the U.S. software industry to thrive. But statistically the fewest petitions succeed, and for now the U.S. software industry doesn't care, though everyone knows that Google has the expertise, the resources and some loyal friends that enable it to present its petition as a more interesting matter than it actually is.</p><p>While I'm kind of tired of this whole process and would really prefer for this thing to be settled or (at least) to go back to district court for further progress, I've been following this case for almost four years and a half and may comment further on on Google's reply brief in the days ahead. Only because Google puts its orchestrated amicus briefs front and center, I wanted to highlight the fact that by far and away the most relevant kinds of potential amici curiae on this issue -- leading software companies that create, enhance and implement APIs -- don't give a damn at this stage. Which also says something.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-2975134513194672322014-12-22T14:30:00.000+01:002014-12-22T15:29:03.481+01:00Samsung argues Apple still can't tie patented features to lost sales, latest bid for ban should fail<p>On Wednesday, Samsung responded to Apple's opening brief (shown in <a href="http://www.fosspatents.com/2014/10/apple-fighting-samsung-in-two-us-courts.html">this October&nbsp;2014 post</a>) in its appeal of Judge Koh's <a href="http://www.fosspatents.com/2014/08/judge-denies-apple-bid-for-sales-ban.html">August&nbsp;2014 denial of a permanent injunction</a> based on the <a href="http://www.fosspatents.com/2014/05/apple-wins-119-million-in-patent.html">spring 2014 trial</a> in the second California litigation between these parties. The public version of Samsung's brief became available late on Friday (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-12-17 Samsung Brief (Reponse to Apple Appeal of Injunction Denial) on Scribd" href="https://www.scribd.com/doc/250725447/14-12-17-Samsung-Brief-Reponse-to-Apple-Appeal-of-Injunction-Denial" style="text-decoration: underline;" >14-12-17 Samsung Brief (Reponse to Apple Appeal of Injunction Denial)</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/250725447/content?start_page=1&view_mode=scroll&access_key=key-50beSVyZ9eXIcgdFChgM&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_55172" width="100%" height="600" frameborder="0"></iframe><p>As usual in the dispute between these parties, it's a very persuasively-written document. Apple argued in its opening brief that it should, at long last, get a permanent injunction because it believes is evidence of a causal nexus between the infringements identified (Samsung notes that it's appealing the merits in parallel) and the alleged irreparable harm is better and because it's now seeking a more feature-specific kind of injunction than before. Now Samsung is saying that Apple's causal-nexus evidence is still too weak and the distinction between a "product" injunction and a "feature" injunction is "mere semantics, since an injunction targeting 'features' in complex, technological 'products' would equally force the 'products' with those features 'off the market'" and, in Samsung's opinion, just as much as any other injunction "threatens to unfairly sow fear, uncertainty, and doubt about the product in the marketplace; to hinder competition; and to grant overprotection to patents."</p><p>It's an interesting debate to follow. Of the four ways in which legal blogging can give value to readers (identifying otherwise-overlooked facts, digesting/summarizing, putting into context, commentary), I'll focus on the latter two because, without context, this is all very confusing. As Samsung's brief mentions, this is already the fourth time for the Federal Circuit to look into an injunction question involving the Apple-Samsung dispute. All previous decisions were basically saying "yes, a patent holder can obtain an injunction in principle, but these are the requirements." It's obvious that Apple can find a number of "yes, you can" passages in those prior rulings (and from decisions in cases involving different parties) while Samsung can find (even more) "however, provided that" type of statements.</p><p>It's difficult to predict the outcome because what one party argues to be a <i>fundamentally</i> stronger case for an injunction can often be described by the other party as merely a <i>gradual</i> (at best) or <i>cosmetic</i> (at worst) improvement. In the past I tended to be too optimistic for Apple. In the first half of this year, a failure by Apple to win an injunction was <a href="https://plus.google.com/+FlorianMueller/posts/CQLN4N8mPj5">the only major smartphone IP decision on which this blog made the wrong call (while it got five other key decisions right)</a>. I now tend to come down on the skeptical side, and that's to some extent also (though not only) because this second California <i>Apple v. Samsung</i> case was already fairly advanced when the more recent decisions relating to injunctive relief came down, so I believe Apple may not have been able to present its strongest case simply because some procedural doors had closed when everyone was wiser after some other event.</p><p>Assuming for the sake of the argument that my skepticism is wrong, inhowfar would it matter if Apple obtained some kind of an injunction this time around? I can see a couple of tangible benefits to Apple. More than anything else, this would show to the industry at large that Apple finally figured out how to obtain sales bans over individual, arguably minor features of highly complex and multifunctional products. That would serve as a deterrent going forward, not with respect to patents that have been asserted before and have turned out to be of a rather narrow valid scape, but possibly with respect to future patents. And, generally speaking, it would make Apple look and feel better. But none of that means that this would hurt Samsung's business: with the particular patent claims-in-suit here, Samsung would have a strong workaround case for every one of them (the clearest one is slide-to-unlock since Apple didn't even accuse all of the products at issue in this year's trial of infringing that one).</p><p>I know it sounds cynical but chances are that, apart from the aforementioned benefits to Apple, this would merely be an opportunity for lawyers to have arguments about workarounds in light of the "no more than colorably different" standard. These two companies kept many smartphone patent litigators around the world very busy for a few years. The days of the Smartphone Patent Litigators Full Employment Act are over, but if Apple got an injunction, we might see some wrangling in the form of contempt motions and hearings over, for example, the '647 "quick links" patent. There would be some more clarity about the limits of that patent but Apple could try to relitigate the claim construction that Judge Posner adopted and the Federal Circuit previously affirmed. That is so because after the <a href="http://www.fosspatents.com/2014/04/appeals-court-deals-apples-current-case.html">Federal Circuit ruling</a>, no formal mandate was issued before Apple and Google entered into a <a href="http://www.fosspatents.com/2014/05/apple-google-dismiss-patent-suits.html">second-class settlement</a>. It would obviously be an uphill battle to try this, and I'm not even sure they would try, but that's the kind of thing that could happen if Apple won an injunction. Samsung would have to handle it, and it would be able to handle it, I'm sure.</p><p>It's really time for them to settle the U.S. part of their dispute as well (everything outside the U.S. already ended this summer), as I wrote in my <a href="http://www.fosspatents.com/2014/12/apple-loses-very-important-round-over.html">previous post</a>. But as long as they don't, the question of injunctive relief is probably Apple's highest priority--not because the devalued and defanged "quick links" patent could deal a major blow to Samsung but because Apple wants the world to see that it knows how to enforce its patents against rival smartphones and tablet computers.</p><p>It may be helpful now to do a quick recap of Apple's previous attempts to obtain injunctions (not talking about ITC import bans here) against Samsung in the U.S.:</p><ol><li><p>In 2011, Judge Koh originally <a href="http://www.fosspatents.com/2011/12/denial-of-us-preliminary-injunction.html">denied Apple a preliminary injunction over three design patents and the rubberbanding software patent</a>. Apple's motion failed for a combination of liability and equitable (access to injunctive relief) issues.</p><p>Apple appealed, and in May 2012, the Federal Circuit <a href="http://www.fosspatents.com/2012/05/federal-circuit-grants-only-small.html">reversed Judge Koh's decision only with respect to a tablet-related design patent</a>. The remand was more of a formality (Judge O'Malley did not even deem it necessary, but the other two judges on the panel did want to leave it to Judge Koh to reevaluate the question). Apple finally obtained a "preliminary" injunction, at a time when the product has pretty much reached the end of its lifecycle. And that one had to be <a href="http://www.fosspatents.com/2012/10/samsung-gets-galaxy-tab-101-ban-lifted.html">lifted</a> after the 2012 jury did not hold that design patent infringed.</p></li><li><p>In the early summer of 2012, Apple won a short-lived <a href="http://www.fosspatents.com/2012/06/apple-wins-us-preliminary-injunction.html">preliminary injunction</a> against the Galaxy Nexus smartphone over a unified search-related patent (this was already part of the <i>second</i> California case). Shortly after it entered into force, that preliminary injunction was <a href="http://www.fosspatents.com/2012/07/federal-circuit-extends-stay-of-samsung.html">stayed pending the appeal</a>. It never became enforceable again because <a href="http://www.fosspatents.com/2012/10/federal-circuit-reverses-nexus.html">the Federal Circuit held</a> that Apple was not entitled to an injunction over this patent for equitable reasons (no Nexus injunction for lack of a causal nexus between infringement and alleged irreparable harm). Also, the appeals court expressed serious doubt about the underlying merits. This combination was a worst-case scenario for Apple, and the "causal nexus" part of that ruling generally upped the ante for Apple's further pursuit of injunctive relief against Samsung.</p></li><li><p>Meanwhile the first California <i>Apple v. Samsung</i> case had gone to trial and Apple was able for the first time in this litigation to seek a <i>permanent</i> injunction. But <a href="http://www.fosspatents.com/2012/12/judge-denies-apple-permanent-injunction.html">Judge Koh said no</a>. While Apple had several liability findings from the jury trial in its favor, Judge Koh applied the "causal nexus" standard the way she understood it from the Nexus preliminary injunction ruling, and the result was that Apple didn't get its sales ban. Apple appealed, and in late 2013 the Federal Circuit upheld the denial of an injunction over certain design patents but with a view to three software patents <a href="http://www.fosspatents.com/2013/11/appeals-court-revives-apples-bid-for.html">found that Judge Koh had not given enough consideration to a piece of evidence (a so-called conjoint survey)</a>. But the appeals court did not direct Judge Koh to enter an injunction. She just had to look at that piece of evidence again, but she <a href="http://www.fosspatents.com/2014/03/setback-for-apple-us-judge-denies.html">ultimately wasn't impressed and denied Apple's renewed motion for a permanent injunction</a>.</p><p>Apple's initial reaction was that it wanted to fight and give it a third try. But it probably realized that none of the three software patents was likely to give it much leverage (if any). And litigation fatigue set in after this year's trial didn't go too well for Apple (it got only about 6% of the damages award it demanded). So in late July 2014, Apple <a href="http://www.fosspatents.com/2014/07/apple-drops-cross-appeal-forever.html">dropped its cross-appeal</a> (Samsung had meanwhile, after a partial retrial, been able to appeal the underlying merits; <a href="http://www.fosspatents.com/2014/12/appeal-of-first-apple-samsung-case.html">the related hearing took place last week</a>).</p></li></ol><p>Everyone's wiser after the event. If Apple had known all of the above decisions (the reasons more so than the outcome) at the outset of the Samsung litigation, it might have been able to present theories that would have been more likely to succeed than the ones it used based on the knowledge it had at the time it had to make its choices. But I don't think this is Apple's biggest problem here. The biggest problem is that those devices are multifunctional and Samsung's products are substantially lawful. In this industry, no one can build a complex, highly multifunctional product without being held to infringe a third-party patent from time to time. That's everyone's problem, not just Apple's, and especially not just Samsung's. In light of this reality, courts are hesitant to give too much leverage to patent holders unless they can really prove that something is a reasonably significant driver of demand. With "quick links" and stuff like that, and with claims that can be worked around (Apple itself doesn't even implement all of them), a causal nexus probably couldn't be established even if Apple could go back in time, use today's knowledge and develop and present its evidence accordingly.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-6941380563945279242014-12-19T07:48:00.001+01:002014-12-19T07:54:14.847+01:00Apple loses very important round over its pinch-to-zoom API patent, Samsung tells appeals court<p>Two weeks ago, the United States Court of Appeals for the Federal Circuit held a hearing on the damages award and underlying liability issues in the first <i>Apple v. Samsung</i> case. In my <a href="http://www.fosspatents.com/2014/12/appeal-of-first-apple-samsung-case.html">commentary on the official recording of the hearing</a>, I also talked about something that was not discussed at the hearing at all: Samsung's challenges to the validity of the '915 pinch-to-zoom API-related patent. The fact that the judges didn't ask questions about it and that counsel had a different focus does not at all mean that the related part of Samsung's appeal is going nowhere. The only thing it suggests is that everyone felt that everything had already been said and that the issue was ripe for decision. And it would increasingly be a surprise if that decision was favorable to Apple:</p><p>Earlier this week Samsung informed the appeals court of a decision by a Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office (USPTO) that could cost Apple up to $150&nbsp;million just in that one lawsuit. The '915 patent, Apple's relatively most valuable software patent in the first Samsung case (most of the damages related to design patents, but Apple's per-unit royalty claim was higher for the '915 patent than for rubber-banding and tap-to-zoom-and-navigate), has been on a rough reexamination ride for some time. From the <a href="http://www.fosspatents.com/2012/12/tentatively-invalid-most-valuable.html">first Office action two years ago</a>, the USPTO's Central Reexamination Division has consistently held all claims of this patent, including the one Apple asserted against Samsung (claim&nbsp;8), invalid. Another thumbs-down Office action (called "final" though it wasn't "final" in the true sense of the word) <a href="http://www.fosspatents.com/2013/07/uspto-hands-down-final-but-not-really.html">came down in July 2013</a>. About a year ago, Apple realized that the only option it had left was to appeal the examiner's rejection decision within the USPTO, to a PTAB. On appeal, <a href="http://www.fosspatents.com/2014/07/us-patent-examiner-stands-by-rejection.html">the examiner stood by his decision</a> as I reported in July (this year). A PTAB hearing was held recently, and the three-judge panel just affirmed the examiner's rejection of all claims (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-12-16 PTAB Decision Affirming Rejection of Apple&#x27;s &#x27;915 Patent on Scribd" href="https://www.scribd.com/doc/250532905/14-12-16-PTAB-Decision-Affirming-Rejection-of-Apple-s-915-Patent" style="text-decoration: underline;" >14-12-16 PTAB Decision Affirming Rejection of Apple&#x27;s &#x27;915 Patent</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/250532905/content?start_page=1&view_mode=scroll&access_key=key-stFb5PFIukmzAkOINn9k&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_99764" width="100%" height="600" frameborder="0"></iframe><p>In a notice filed with the Federal Circuit, Samsung's counsel argues that "[a] final decision by an administrative body has collateral estoppel effect" and describes this as "an additional reason to reverse the $114&nbsp;million in lost profits awarded for infringement of the '915 patent and to vacate the $35&nbsp;million in royalties awarded for infringement of the three utility patents-in-suit."</p><p>The latter part about vacating that award would, even though the amount is relatively small by the standards of these companies and their dispute, require a damages retrial involving more or less all products at issue. And a retrial may be necessary anyway because of the design patent and/or trade dress damages issues in the case (which the appellate hearing focused on).</p><p>So for the first <i>Apple v. Samsung</i> lawsuit, there is no end in sight. And the process concerning the '915 patent isn't over either. Apple can choose to immediately appeal the '915 decision to the Federal Circuit. Samsung's notice to the appeals court also says that "Apple can request a discretionary [PTAB] rehearing."</p><p>Even if the appeals court disagreed with Samsung on collateral estoppel, the USPTO decision can't be ignored. The credibility problem the '915 patent faces is that no one at the USPTO who looked at this patent <i>after</i> an anonymous requester presented some new invalidity theories-- by now, four persons: the (re)examiner and the three PTAB judges--believed at any point that a single claim of this patent deserved to be upheld. That is, frankly, pretty damning. Of course things can always change, but it's less and less likely.</p><p>If the appeals court didn't agree with Samsung on collateral estoppel, it would still have to make its own decision on Samsung's invalidity theories. The legal standard for invalidating a patent in an infringement litigation is higher (clear and convincing evidence) than at the USPTO (preponderance of the evidence), but the consistent stance of the USPTO (again, four persons) has been clear and convincing.</p><p>Apple's decision in the summer to <a href="http://www.fosspatents.com/2014/07/apple-drops-cross-appeal-forever.html">drop its cross-appeal</a> (<i>i.e.</i>, not to pursue an injunction anymore in that case) may also have to do with Apple's realization that this patent is going down the tubes even though it still can appeal the USPTO's final decision to the Federal Circuit. The '915 patent was the only patent in the first California case with respect to which Apple argued that Samsung continued to infringe (though Samsung said it had a workaround). If there was any patent in the first Samsung case over which Apple would have liked to win an injunction (in order to then have a debate over whether the workaround indeed is a workaround), it would have been this one. But Apple is now, instead, fighting hard for an injunction in the <i>second</i> California case against Samsung, which Judge Koh <a href="http://www.fosspatents.com/2014/08/judge-denies-apple-bid-for-sales-ban.html">denied in August</a>. Samsung had a deadline this week to respond to Apple's opening brief on appeal, and the docket indicates that the filing was made but it's not yet publicly accessible (I'll comment on it when it's available).</p><a name="generalcomments"><p><b>The state of Apple's patent enforcement efforts and the strategic landscape</b></p></a><p>Apple's patent assertions, despite the undoubtedly great work performed by the lawyers involved, have massively underperformed the expectations I used to have for some time (even in the summer of 2013 I still thought that, after some setbacks, there were signs of Apple still turning this around). I do know that a lot of people in different places were very surprised when they felt this year that my tone had changed. I can understand that, but conspiracy theories are a poor substitute for facts. The reason I adjusted my position was that after the summer of 2013, several important things happened that showed to me Apple wasn't going to get huge leverage. There came a point when I had to face those facts and draw the appropriate conclusions. And I was indeed thoroughly disappointed when I saw Apple bring an outsized damages claim in the second Samsung case. It looked to me like a desperate act after repeatedly failing to win (lasting) sales bans, and it was inconsistent with Apple's own positions on the value of patents in other contexts--positions I always supported and never disagreed with.</p><p>Apple itself vindicated the adjustment of my positions through its strategic retreat. It <a href="http://www.fosspatents.com/2014/05/apple-google-dismiss-patent-suits.html">agreed with Google/Motorola to drop all pending litigation between those companies</a>; it then agreed to <a href="http://www.fosspatents.com/2014/08/apple-and-samsung-drop-all-non-us.html">confine the once-earth-spinning Samsung dispute to only one jurisdiction, the United States</a>. And it hasn't brought any new cases, neither against long-time rival Samsung nor against any other Android device maker, in a long time. So it wasn't just me who determined this year that this was going nowhere for Apple. Apple's leadership recognized this and decided accordingly.</p><p>Even the remaining part of the Apple-Samsung will go away at some point--I find it hard to imagine that they (meaning both companies, but particularly Apple because it started this) really want to have a third California trial in just their first lawsuit (or a fourth trial in total).</p><p>For as much as Apple's supposedly "thermonuclear war on Android" <i>under</i>performed my expectations, Apple's ability to command premium prices and still sell incredibly high volumes of products, has to a comparable extent <i>out</i>performed them. According to <a href="http://www.gartner.com/newsroom/id/2944819">Gartner's latest data</a>, more than 83% (five out of six) of smartphones sold in the world run on Android, and more than 12% on iOS. But then there's also data that shows iPhone and iPad users are really much more active, and obviously many low-cost Android phones are technically smartphones but practically used as feature phones. In fact, just for app testing purposes I bought various low-cost Android phones (all of them in the 50 euro price range) from different vendors with screen sizes from 3" to 4". If you look at it strictly through a functionality lens, those are smartphones and you can run a million apps or so on them. But Apple is still doing very well. Incredibly well in fact.</p><p>I also bought an iPhone 6 Plus and an iPad Air 2. I now use the iPhone alternatingly with an Android phablet. My Android phablet has a significantly higher resolution, and when you view photos, it's quite a difference, and it's even noticeable when you just look at the standard user interface. But there's definitely some magic detail about the iPhone user experience. For example, when switching (in a test program for a component of an app I'm working on) from portrait to landscape (or the other way round), it's not just a sudden repositioning of all items but a smooth animation that I haven't seen in any Android app to date. That animation won't be patentable. But it's one example (and I could give more of these) of how Apple still manages to differentiate. Without litigation. Without injunctions.</p><p>What also still helps Apple to justify a price premium (and also has nothing at all to do with patent litigation) is the average quality of the apps available for the two platforms. I regularly look at many apps on both platforms. The two game categories I follow most closely are trivia games and puzzle games. In the trivia game genre, there's no noticeable difference in quality between Android and iOS, thus no reason to pay a premium price for an iPhone. In the puzzle games field, however, the difference is rather significant. While Candy Crush and some other titles from major publishers look and feel the same on both platforms, I've seen some really great games in this genre from smaller developers that exist only on iOS (or all you may get for Android is an unauthorized clone of inferior quality). There's still a lot of talented developers who develop primarily for iOS and invest more heavily in their iOS versions, despite the fact that you can reach so many more people in the world with an Android app. That's because iPhone users have more purchasing power than Android users.</p><p>It turns out that patent litigation was neither a winning strategy nor a necessary last resort for Apple. I can still understand why they thought they had to enforce their rights, but Apple's greatest strategic assets appear to be unprotectable by patents. IP has never been the only entrance barrier in this industry. It will continue to be important, and even Apple may at some point get more leverage out of its patents in different contexts. But stuff like a patent on a pinch-to-zoom-related API turned out to be of no value in the end. It's time for the U.S. part of <i>Apple v. Samsung</i> to end. With the Holiday Season so close, it may not happen this year, but next year is most probably the year for the definitive settlement.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-50573897836742575462014-12-12T11:24:00.000+01:002014-12-12T11:24:07.507+01:00Government delegates express 'concern at an incident unique in the history of EPO': suspension of judge<p>On its website, the European Patent Office has published a "<a href=" http://www.epo.org/about-us/organisation/communiques.html#a10">communiqué</a>" concerning this week's meeting of the Administrative Council (AC) of the European Patent Organisation (the international body running the EPO) that contains a sybilline sentence on the suspension of an EPO-internal judge (member of a board of appeal) for disciplinary reasons. The suspension was widely criticized, including but not limited to a <a href="http://techrights.org/2014/12/09/exclusive-eboa/">letter by (internal) members of the Enlarged Board of Appeal (EBA) to the AC</a>, a <a href="http://ipkitten.blogspot.de/2014/12/leading-european-ip-judges-join-chorus.html">letter by two external EBA members, Lord Justice Floyd and high-ranking Dutch court official Robert van Peursem</a>, which was subsequently <a href="http://www.eplawpatentblog.com/eplaw/2014/12/epo-breaking-letters-to-ac-from-floyd-van-peursem.html">endorsed by leading patent judges from six other countries</a>, and an <a href="http://www.fosspatents.com/2014/12/top-notch-patent-litigator-sees.html">email sent by a German patent litigator to his country's AC member</a>.</p><p>The aforementioned sybilline sentence is at the end of a paragraph that says the AC "unanimously decided to suspend [the judge in question] from active duty on full salary until 31 March 2015" and will take further decisions after completion of the investigation:</p><blockquote><p>"The [Administrative] Council expressed its concern at an incident unique in the history of EPO."</p></blockquote><p>If this sentence explicitly mentioned a reprimand of President Battistelli for compromising judicial independence, its meaning and its significance would be clear. However, "an incident unique in the history of the EPO" is vague enough that this could also mean unanimous backing of the executive's action and concern over whatever the suspended judge may have done. That interpretation is less likely to be correct than disagreement with the way the executive leadership handled the matter, but it can't be ruled out completely in light of the unanimous endorsement of the suspension.</p><p>Let's take a look at the third paragraph:</p><blockquote><p>"The Council took this opportunity to reiterate its full endorsement of and support for the principle of independence of the members of the Boards of Appeal, as specifically set out in Article 23 EPC and generally embodied in internationally recognised principles of judicial independence."</p></blockquote><p><a href="http://www.epo.org/law-practice/legal-texts/html/epc/2013/e/ar23.html">Article 23 EPC</a> is very clear:</p><blockquote><p>(1) The members of the Enlarged Board of Appeal and of the Boards of Appeal shall be appointed for a term of five years and <b><i>may not be removed from office during this term</i></b>, except if there are serious grounds for such removal and <b><i>if the Administrative Council, on a proposal from the Enlarged Board of Appeal, takes a decision to this effect</i></b>.</p><p>(emphasis obviously added)</p></blockquote><p>Still, what's really missing from the communique is an unequivocal condemnation of the fact that a judge was indeed removed from office without an EBA proposal, let alone a Council decision.</p><p>There's a part I don't understand, at least not without further explanation. In the very same communiqué, the Council emphasizes Article 23 EPC <b><i>and</i></b> announces a unanimous suspension decision. Article 23(1) allows a removal from office of a judge only "if the Administrative Council, <b><i>on a proposal from the Enlarged Board of Appeal</i></b>, takes a decision to this effect." (emphasis added)</p><p>The letter from the Enlarged Board of Appeal to the Council, however, contains no indication whatsoever that the EBA proposed such a removal from office. If anything, it suggests the opposite.</p><p>The EBA letter refers to other articles, and Art. 10(h) allows the president to propose disciplinary action to the AC, which then decides under Art. 11(4). In this case, the suspension quite apparently occurred <i>before</i> the AC decided. So for the time between the suspension taking effect and the AC endorsing it, it appears to me that the removal from office had no legal basis whatsoever--at least none that I'm aware of.</p><p>But if this is all about Articles 10 and 11, why does the AC emphasize Rule&nbsp;23? The standard under Rule&nbsp;23 is higher: it takes (besides a factual basis) an EBA proposal and a Council vote, not just a presidential proposal and a Council vote. Is this an attempt to mislead the general public? Or did they just want to avoid any direct references to the article(s) the president violated?</p><p>In my opinion, the Rule&nbsp;23 standard is the right one and even the combination of Articles 10 and 11 is too low a standard. But even that lower standard apparently wasn't met.</p><p>Officials have been forced to resign over smaller things than this. But in politics it's not unusual at all that those who appoint someone stand by the appointee for as long as possible, hoping that the storm will subside. If it doesn't, they can still take further action. The AC definitely keeps an important door open. If they want to sack Battistelli, they can do so whenever the investigation has been completed and it turns out that apart from the president acting <i>ultra vires</i>, the alleged misconduct by the suspended judge fell clearly short of anything that would justify a removal from office even if the proper procedures had been followed.</p><p>All in all, despite the unanimous endorsement of the suspension and my disappointment over it, I tend to see a significant crack in the shell here. The next few weeks and months will prove decisive. For now, Battistelli remains in office. But for how long is uncertain.</p><p>Coverage of this scandal in the general press will also play a key role. I heard that a Munich area center-right newspaper, <a href="http://www.merkur-online.de/">Münchner Merkur</a>, published an article in yesterday's print edition, entitled "Die letzte Diktatur auf deutschem Boden" ("the sole remaining dictatorship on German soil"). Things can't stay that way forever. The AC's "communiqué" should be interpreted by the IP sector and by innovative companies depending on high-quality patents (I heard from an unofficial source that a compensation scheme with potentially disastrous implications for European patent quality was approved yesterday) as an invitation to push even harder for serious reform. It shows that all these recent efforts, by EPO staff and by others, didn't go unnoticed, but they <i>will</i> one day have been in vain unless there's even more pressure now.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-85814421729573943792014-12-09T12:36:00.001+01:002014-12-09T12:55:49.068+01:00Oracle effectively says Google jumped gun with Supreme Court petition in Android-Java copyright case<p>James Niccolai of the <a href="http://www.computerworld.com/article/2857293/legal/oracle-asks-supreme-court-to-reject-android-copyright-case.html">IDG News Service was first to obtain a copy</a> of Oracle's response to Google's <a href="http://www.fosspatents.com/2014/10/googles-supreme-court-petition-in.html">petition for writ of certiorari (request for Supreme Court review)</a> in the Android-Java copyright case. Here's the brief (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-12-08 Oracle Response to Google Petition for Writ of Certiorari on Scribd" href="https://www.scribd.com/doc/249606712/14-12-08-Oracle-Response-to-Google-Petition-for-Writ-of-Certiorari" style="text-decoration: underline;" >14-12-08 Oracle Response to Google Petition for Writ of Certiorari</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/249606712/content?start_page=1&view_mode=scroll&access_key=key-xCBYLe1enA9NI1q1HNeA&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_41029" width="100%" height="600" frameborder="0"></iframe><p>This is one of those documents that are most interesting when read backwards. The order in which it lays out Oracle's argument against Google's petition makes sense for those looking at the case for the first time, but after more than four years of coverage on this blog, I guess most of you already know the history of the case and the fact pattern that gave rise to this case in the first place. If the latter is new to you, or if you're looking for a refresher, the <a href="http://www.fosspatents.com/2013/02/oracles-appeal-brief-likens-google-to.html">"Ann Droid" story</a> Oracle told to the Federal Circuit is a more lively version of it. Then Oracle goes on to explain why the law has always been what it is, and I have viewed it that way for a long time, including a time when I was at loggerheads with Oracle. There's a simple plausibility test for the whole non-copyrightability claim: look at whatever cases Google and its allies show you in which copyrightability was denied (and that's different from finding in favor of fair use); then look at whether the affected material was a similar combination of quantity and originality as in the case of the Java API declaring code, and you'll find in each case that there was no such combination--and you can find numerous examples of cases in which material way less worthy of protection than the Java API declaring code was held copyrightable by U.S. courts. Life's too short to be a broken record, so I'll focus on what's new and what it means in strategic terms. And to that end, it happens to be most fruitful to start at the end.</p><a name="interlocutory"><p><b>Interlocutory appeal: why now? why not later?</b></p></a><p>The very last section argues that Google's interlocutory appeal to the Supreme Court was premature. An interlocutory appeal is an appeal prior to a final judgment. Here, the alternative for Google would have been to let the remand to California happen, to have the judge or another jury decide on "fair use", and to further appeal after losing the case. (Oracle's appeal to the Federal Circuit was <i>not</i> interlocutory because, if it had not been brought, the case would have been over.)</p><p>When Google <a href="http://www.fosspatents.com/2014/06/appeals-court-issues-formal-mandate-to.html">chose not to ask the Federal Circuit for a rehearing</a>, I was already wondering whether Google would focus on "fair use." Maybe Google was also thinking about the pro's and con's then, but at any event it decided it wants to take this case directly to the Supreme Court.</p><p>That, all by itself, does not mean Google's petition will fail. As the <a href="http://www.scotusblog.com/2005/09/interlocutory-cases-at-the-s-ct/">SCOTUSblog wrote in 2005</a>, "the importance of the interlocutory status of a case is often grossly overstated." In reality, "[t]he Court regularly grants cert in non-final cases that raise important issues even when the proceedings on remand could illuminate the record in relevant respects and could affect the legal issue presented."</p><p>In this case, there is an extraordinarily strong connection between the questions of copyrightability and fair use, and that is so because of the way Google elected to argue the case in district court and on appeal. Oracle is right that Google can't seriously claim the software industry needs a quick resolution of an alleged "circuit split" (inconsistencies between different regional appeals courts) that it claims has existed for decades when the U.S. software industry, and especially the software industry in the Ninth Circuit (<i>i.e.</i>, the West Coast, meaning mostly Silicon Valley and Microsoft), undoubtedly thrived. Still, the interlocutory status of the case doesn't guarantee the failure of Google's petition (nor does it make things any easier for Google given the huge number of petitions the Supreme Court receives).</p><p>The reason I'm interested in this has nothing to do with what the Supreme Court may or may not decide. Other factors are going to have more weight in that regard, so in case the Supreme Court denies the petition, the interlocutory status probably won't have been the reason. The most interesting aspect is that Google, to say it cautiously, does not quite exude confidence in its "fair use" defense with this tactical choice. It's old news that I <a href="http://www.fosspatents.com/2014/01/why-google-books-is-probably-fair-use.html">don't buy the "fair use" defense here</a>. But if Google really believes in it, why doesn't it just let the case go back to district court, try to win the "fair use" debate based on its "compatibility" argument, and if Oracle appealed again, Google could still try to take the copyrightability part, if it became necessary, to the Supreme Court? This is conjectural but the more I think about it, the more I feel that Google is <i>not nearly</i> as convinced of its two defenses-- non-copyrightability and "fair use"--as it claims and as its supporters claim. The Federal Circuit provided some guidance on "fair use" that ups the ante for Google, and what will up the ante to an even greater extent is that its equitable defenses failed, enabling Oracle on remand to ask the district court to preclude Google from making certain arguments that the first jury (with a bright foreman who couldn't dissuade other jurors from an illogical stance) probably thought had a bearing on "fair use" (Schwartz testimony etc.).</p><p>I can't see a winning strategy here for Google with respect to copyrightability, and its only chance with fair use is to get another jury involved that doesn't figure it out, though it will be easier to figure out next time. I wouldn't put it past Google that this here is mostly about delaying the resolution of the case. Nonsensical arguments like saying the software industry (which is mostly on Oracle's side anyway) needs this resolved immediately don't look strong.</p><p>There's another indication (that is not in the Supreme Court briefs) of Google's lack of faith in its defenses. Yesterday, <a href="http://android-developers.blogspot.de/2014/12/android-studio-10.html">Google finally released the first official non-beta version of Android Studio, version 1.0</a>. The Android developers on the team I'm leading and I really like Android Studio (in light of Apple's Swift, Google should do <i>even more</i> to increase developer productivity). But somehow Google is cautious about directly integrating Java material into Android Studio, as <a href="http://stackoverflow.com/questions/26772583/errorcompilesdkversion-android-21-requires-compiling-with-jdk-7-windows">this Stack Overflow discussion</a> shows (it slightly predates version 1.0, but the situation is still the same). This doesn't solve Google's entire Java copyright problem. Still, what reason other than a desire to at least limit the extent of the problem would Google have to deliver an IDE--which means <u>Integrated</u> Development Environment--without <i>fully</i> integrating Java, if it's supposedly for the taking?</p><a name="incomplete"><p><b>Google's petition addresses only one of the two reasons for which the Federal Circuit agreed with Oracle</b></p></a><p>The first subsection of the last section of Oracle's brief is short--merely two paragraphs--but raises an important issue:</p><blockquote><p>"Although one would never know it from Google's petition, the court of appeals found that Oracle's work is protected on two separate bases: (1) the original declaring code and (2) the packages' creative structure and organization."</p></blockquote><p>This is correct. Here's a quote from the Federal Circuit's own summary of its reasoning:</p><blockquote><p>"[W]e conclude that the declaring code and the structure, sequence, and organization of the 37 Java API packages are entitled to copyright protection."</p></blockquote><p>Oracle notes that Google's petition is all about the declaring code per se and "does not address the structure-and-organization rationale." According to Oracle, the failure to address an adequate alternative basis for affirmance means the petition must be denied.</p><p>Google's request for Supreme Court review (unlike certain amicus curiae briefs) is all about the functional nature of code. However, as Oracle writes in its response, "[w]hatever might be said about declaring code, the structure and organization is not used 'to operate the methods, i.e., the pre-written programs.'"</p><p>This potential reason for denying Google's petition is closely related to what Oracle says in the next subsection: Google now bases its theory on "system" and "method of operation" in the cert petition "[b]ut in the court of appeals, Google made no such argument."</p><p>I've said it before: Google's approach does not exude confidence. In its quest for some reason to get 7,000 lines of highly creative (and creatively-structured) material held uncopyrightable, it isn't consistent.</p><a name="denialwouldbeeasy"><p><b>It would be easy for the Supreme Court to deny Google's petition</b></p></a><p>The previous paragraphs discussed potential reasons for a denial of Google's petition beyond the simple fact that such a massive body of highly creative (and creatively-structured), original, expressive material has always been and will always have to be copyrightable.</p><p><a href="http://www.mayerbrown.com/de/Opposing-Certiorari-in-the-US-Supreme-Court-01-01-1999/">This article</a> discusses how litigants are most likely to succeed in opposing a cert petition and says the following about the top court's selection criteria:</p><blockquote><p>"Instead of seeking merely to correct erroneous decisions, the Court is looking, Chief Justice Rehnquist has written, for cases 'involving unsettled questions of federal constitutional or statutory law of general interest.'"</p></blockquote><p>Google's primary argument for presenting an "unsettled" question is that the Supreme Court was divided a long time ago over 50 words used as menu items. As Oracle's response to the petition clarifies, that is not a question of software copyrightability. The way I view it is (apart from the question of whether we're talking about text or code) that if the Supreme Court didn't unanimously hold those menu items uncopyrightable, Cisco is fine with its <a href="http://www.fosspatents.com/2014/12/cisco-suing-arista-over-set-of-500.html">500 <i>multi</i>-word commands</a>, but even those multi-word commands are very simple if you compare them to some of the more complex lines of declaring code in Oracle's Java APIs, such as this example cited by Oracle in its brief:</p> <blockquote><p>public abstract void verify (PublicKey key, String sigProvider)<br>throws CertificateException, NoSuchAlgorithmException, InvalidKeyException, NoSuchProviderException, SignatureException</p></blockquote><p>That's a lot longer than the Math.Max example Google and its supporters like to point to (and which may have helped Google to confuse the district judge).</p><p>Oracle's brief also notes that one can't compare (as Google did in its <a href="http://www.fosspatents.com/2014/10/googles-supreme-court-petition-in.html">petition</a>) the QWERTY keyboard layout (the order of a couple dozen keys) to declaring code like the line above.</p><p>Getting back to Judge Rehnquist's criteria, it has to be a <i>combination</i> of "unsettled" and "of general interest." Unless one lowers the standard, there is no such combination here.</p><p>When I read Google's brief and the amicus briefs urging a review, I can't help but feel that they base their hopes on factors that reside at a meta-level rather than the factual, logical level. They try to make this a case that is all about interoperability, and I'll talk about that in the next section of this post. They try (some more overtly, some more subtly) to capitalize on what they believe to be friction between the Supreme Court and the Federal Circuit.</p><p>It won't be easy for them to get a Supreme Court review on that basis, but even if they did, I still can't see how they could ultimately <i>prevail</i> at that meta-level.</p><a name="interoperability"><p><b>"Partial interoperability" is a contradiction in terms, says Oracle</b></p></a><p>While not putting those <i>Sony</i> and <i>Sega</i> fair use cases front and center at this juncture, Google still tries to leverage the (important) concept of "interoperability" (or its synonym, "compatibility") to get the Supreme Court interested. Oracle makes a few references to this in its brief that I wish to highlight.</p><p>In connection with "overwhelming [record evidence] that Android is incompatible with the Java platform," Oracle describes the notion of "partial interoperability" as a "contradiction in terms." If products are interoperable, they work together. If they are not, they don't. They can obviously work together to varying degrees, but the problem in this case is that what Google and the district judge meant by "partial interoperability" would more accurately be labeled as "familiarity." Interoperability happens (or doesn't happen) at the technical level, while familiarity is a state of mind. Some will argue that one can make changes to Java code in order to make it run on Android, and vice versa. But apart from this kind of definition having no boundary, it involves some additional work to be performed by human beings.</p><p>Google didn't advance the cause of interoperability when it sought to shut down Microsoft products implementing two industry standards (<a href="http://www.fosspatents.com/2013/09/motorola-wanted-free-license-now.html">a jury thought this behavior warranted a $14.5&nbsp;million damages award)</a>. It won't do the concept a favor by trying to stretch the definition of the term beyond recognition. So I, too, believe that "partial interoperability"--the way the district court and Google meant it--is a logical fallacy.</p><p>Oracle also addresses Google's argument that Oracle's asserted code must be devoid of copyright protection in order to prevent a "lock-in":</p><blockquote><p>"[B]ecause Google deliberately made Android incompatible, when a programmer writes for Android, that programmer and program are locked <i>into</i> Android and locked <i>out</i> of the Java platform.</p></blockquote><p>In the policy context, Oracle firmly rejects Google's (and Google's friends') argument that such material as the Java API declaring code would have to be free for the taking in order to enable innovation:</p><blockquote><p>"Google is wrong that unauthorized copying of others' code is just how the software industry works."</p></blockquote><p>Oracle doesn't say that incremental innovation shouldn't occur. The question is just on which basis. Building on top of what others create and making products work together with existing ones, or making them run on existing platforms is fine, as long as you write your own code. Using what others created is fine if you take a license. But "[t]heft is theft whether the work is a novel or complex software." Except, of course, if the "fair use" defense applies (which could be evaluated very quickly if the Supreme Court denied Google's petition).</p><a name="sflc"><p><b>Free software advocates speak out against the Federal Circuit <i>and</i> Google's petition</b></p></a><p>The Free Software Foundation and the Software Freedom Law Center have filed an <a href="https://www.softwarefreedom.org/resources/2014/google_v_oracle-sflc_cert_amicus.pdf">amicus brief</a> that technically (but not substantively) supports Oracle. The free software advocates engage in a balancing act. They are on Google's side with respect to copyright <i>and</i> with respect to copyleft, but they have a procedural preference for denial of Google's cert petition.</p><p>I've read their brief and would just like to explain what I believe their strategy is, and the philosophical and legal issues involved.</p><p>Richard Stallman, the founder and president of the FSF, leads the life of an itinerant preacher and one can only admire him for how committed he is to his cause. I've disagreed with Eben Moglen, who used to be the FSF's counsel for some time and still works closely with the FSF through his Software Freedom Law Center, on more than one occasion, but he's always extremely interesting to listen to.</p><p>Tim O'Reilly <a href="http://radar.oreilly.com/2007/08/my-tonguelashing-from-eben-mog.html">described</a> the problem with the free software philosophy more than seven years ago: </p><blockquote><p>"I continue to feel that the focus of the free software movement on 'software' rather than on 'freedom' is the real lost opportunity. [...] Focusing only on free software is as limiting as focusing on free hardware. It's freedom that matters."</p></blockquote><p>The GPL licensing regime puts the freedom of program code above the freedom of developers. The copyleft principle requires all derivative works including GPL-licensed code to be made available under the GPL. This ensures that one cannot enjoy the freedoms granted to him by the GPL and then publish a derivative work under, for example, a proprietary, closed-source license. By contrast, non-copyleft open source licenses don't guarantee that the related code will always remain available on the same terms, but they give commercial software developers the freedom to incorporate it into their products.</p><p>The GPL is not about freedom-freedom. It's about <i>enforceable</i> freedom. And in order for anyone to enforce the GPL, the legal system as it stands (where copyleft is not enshrined in statutory law) only offers copy<i>right</i> for a basis. Copyleft wouldn't work without copyright enforcement. Yes, this is an oxymoron.</p><p>The dependence of copyleft on copyright is why Richard Stallman counterintuitively <a href="https://www.gnu.org/philosophy/pirate-party.en.html">criticized the Pirate Party</a> for proposing to limit copyright terms. RMS (he's frequently referred to by his initials) warned that this would allow "marauding giants" to incorporate free software into non-free software after only a few years. For someone advocating general freedom as opposed to just software freedom, this wouldn't be a big deal: one could simply let both approaches, free software and commercial software, compete. But that's not acceptable to the free software community.</p><p>RMS and Eben Moglen are copyright minimalists. They want just the level of copyright protection that is needed to make the GPL work in principle. Anything beyond that is undesirable to them. The Pirate Party proposed a copyright reform that would fall short of what the GPL needs. But other than that, less copyright is more if you ask RMS or Professor Moglen.</p><p>And now comes the part where they are demonstrably inconsistent. While they <i>generally</i> don't want commercial software developers to incorporate free software into their products ("marauding giants"), and while Richard Stallman considers commercial software to be immoral, they still know that the popularity of Linux (GNU/Linux as they would call it) depends on the availability of non-GPL software (other open source software as well as commercial software) for Linux.</p><p>If they were 100% principled, they'd have to like the Federal Circuit's clarification of longstanding principles of U.S. copyright law because it can prove useful in GPL enforement, or at least they should be neutral about it because free software is not made any less free by it. But their objective now is to describe the Federal Circuit opinion (incorrectly) as an outlier that shouldn't have any weight going forward. That's what their brief is really about. They don't want the Supreme Court to look at it because (without saying so) they're afraid of the outcome, knowing that the law is what it is and has been for a long time. If the Supreme Court granted certiorari, the free software guys might file another brief or just hope that what they submitted yesterday would help Google at that stage. But ideally, they just want the process to end. They want to have their cake and eat it. They try hard (but in my eyes fail) to hide the fact that this initiative of theirs runs counter to free software philosophy and is driven by the less than principled desire to let free software like Linux power non-free software like Android.</p><p>One of their claims is that the copyrightability question plays no role in this dispute because Google could always use the relevant material under the GPL. The commercial reality is that Google doesn't want to release Android under the GPL. It's a complete <i>non sequitur</i> to me in the FSF/SFLC brief how Google could use the Java API declaring code under the GPL, incorporate it deeply into its own products, and not have a copyleft "share-alike" obligation. So the free software brief is more of a mystery than it provides clarification. The greatest mystery is how the GPL would moot the question of past damages. But frankly, it's not worth worrying about.</p><p>The FSF/SFLC brief does, however, show to the Supreme Court that even some of those who don't like the Federal Circuit opinion would like the case to go back to district court now for a "fair use" analysis.</p><p>I don't know if any other amicus briefs will be filed. Presumably the software industry at large is just fine with the Federal Circuit ruling, which means business as usual.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-4751563418762415132014-12-08T18:42:00.000+01:002014-12-09T05:24:56.688+01:00Top-notch patent litigator sees judicial independence at the European Patent Office compromised<p>This week's meeting of the Administrative Council of the European Patent Organisation (the multinational entity running the European Patent Office), scheduled for Thursday, is set to be the most dramatic crisis meeting in the history of the EPOrg/EPO. Not only has the current, allegedly autocratic president lost the faith of very large parts his staff (there's an ongoing strike and <a href="http://www.fosspatents.com/2014/12/european-patent-office-pays-for-health.html">at a demonstration last week, a significant number of participants chanted "Battistelli -- démission!"</a>) but through his actions he has created a situation in which the community of patent practitioners ever more publicly sides with the staff. I can't help but see certain analogies between the pace of current developments at the EPO and the events that led to the Fall of the Wall 25 years ago.</p><p>Normally, patent attorneys and litigators stay above the fray of labor conflicts at the EPO. They discuss their patent applications and draft claims with examiners, they plead their cases to the boards of appeal, but they don't take positions on internal matters of the Office. That is, unless things get completely out of hand and the actions of a few people at the top become a threat to the functioning and the reputation of the IP sector at large. And that points appears to have been reached now.</p><p>Earlier today I <a href="http://www.fosspatents.com/2014/12/european-patent-office-examiners-fear.html">said I had not yet been able to verify</a> reports (particularly <a href="http://ipkitten.blogspot.de/2014/12/in-suspense-about-european-patent.html">by the IPKat blog</a>) of a suspension of a member of a board of appeal (<i>i.e.</i>, an EPO-internal judge) by the president, which would be completely irreconcilable with the EPO's own rules and the judicial-independence standard of the civilized world. I have for approximately ten years repeatedly taken the position in political debates that EPO-internal judges should be appointed for life instead of being dependent on reappointment by the leadership. But even if they are only appointed for five-year terms, a certain process must be followed if they are "suspended" before the end of the term. And that process has, as more and more sources say, not been followed in a recent case.</p><p>From what I hear, one can see a printout of <a href="http://www.zimpat.com/en/strike/page.html">this webpage</a>, on which the patent firm of Zimmermann &amp; Partner (known for work on behalf of blue-chip clients in multiple fields of technology) expresses its support for the EPO staff, on many doors at the EPO's different locations (Munich, The Hague, Vienna, Berlin). And I venture to guess that an English translation of an email sent by one of Germany's leading patent litigators, <a href="http://www.bardehle.com/en/team/detail/person/mueller-stoy-tilman-1.html">Bardehle Pagenberg's Dr. Tilman Mueller-Stoy ("Müller-Stoy" in German)</a>, whose work on behalf of Microsoft I've mentioned various times (and whose other clients include, inter alia, Amazon and a major automotive company) to German Federal Ministry of Justice official and EPO Advisory Council member Christoph Ernst will also rise to tremendous popularity in the corridors of the EPO (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View Email to Mr Ernst - Concerns About Judicial Independence at EPO on Scribd" href="https://www.scribd.com/doc/249537968/Email-to-Mr-Ernst-Concerns-About-Judicial-Independence-at-EPO" style="text-decoration: underline;" >Email to Mr Ernst - Concerns About Judicial Independence at EPO</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/249537968/content?start_page=1&view_mode=scroll&access_key=key-E5DNiE7xUZ8T3y1EEkYJ&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7068965517241379" scrolling="no" id="doc_92197" width="100%" height="600" frameborder="0"></iframe><p>In this letter to the German representative on the Administrative Council (basically the board of directors) of the EPO, Dr.&nbsp;Mueller-Stoy urges the national governments controlling the EPO "to take measures which are appropriate for safeguarding the independence of the Boards (<i>i.e.</i>, the EPO-internal courts)" in light of measures of President Battistelli that "ultimately discredit[]" the patent system as a whole. The email expresses concern to say the least (one might even say outrage) over the fact that "the President obviously acted autonomously by using disciplinary power" to effectively depose a judge, though there should be, according to the rules, a clear separation of powers that ensures the judicial independence of the members of the boards of appeal.</p><p>The letter draws attention to a second, less publicly-known way in which "the President also transgresses his powers." It apparently used to be a matter of routine that the chairman and the members of the boards of appeal were reappointed at the end of their five-year terms. Now, however, reappointments are frozen. I recently received, from an anonymous source, an official document that according to which at least two boards of appeal are (or will shortly be) without chairmen. As a result, "Members of the Board whose appointment period is due to expire shortly consider themselves put under pressure by the President until their reappointment has been made." This, quite obviously, compromises their independence.</p><p>The penultimate sentence of the email describes the current situation at the EPO in drastic terms:</p><blockquote><p>"In addition to these described developments at the Boards of Appeal, there seems to currently prevail an 'atmosphere of fear and terror' which results in numerous disciplinary procedures against unwelcome staff members of the EPO."</p></blockquote><p>I keep my fingers crossed that a tipping point has been reached now or will be reached over the next few days, and that even wider parts of the European IP community will stand up in support of fundamental rights, due process, patent quality, and judicial independence. But this is not just about a few individuals at the top of that organization. There are serious structural deficiencies that have led to the current situation, and they must be addressed as soon as possible.</p><p><b>[Update]</b> IPKat has <a href="https://drive.google.com/file/d/0B8Z2vXbRaxmbMDJFbk5TaFRtcm8/view?pli=1">published</a> and <a href="http://ipkitten.blogspot.de/2014/12/breaking-news-enlarged-board-appeals.html?m=1&winst=1418071166665&of=0">commented</a> on "a letter which is unprecedented in the 40 year history of the European Patent Organisation": a reqest by the members of the Enlarged Board of Appeal (the highest in-house judiciary body) of the EPO that the Administrative Council act against President Battistelli's "clear challenge to the judicial independence of the Boards of Appeal." The letter also mentions that the suspended judge's "computer was confiscated by the [President's] investigation unit, which has given them access to possibly confidential information regarding the preparation and deliberation of cases by the member's board, without proper, legally sound guarantees." I'm speechless. There's a banana republic-style enclave in the heart of Munich (notably with a vice president facing multiple corruption charges in his own country but having stayed in power nevertheless), and so far this banana republic has been condoned and supported by governments that constantly preach human rights and democracy to countries like China and Russia. But it's not a banana republic at all levels (as the Enlarged Board's letter shows, there's plenty of principled people at work). Only at the <i>very</i> top. <b>[/Update]</b></p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-731742642545719802014-12-08T08:36:00.000+01:002014-12-08T08:36:36.983+01:00European Patent Office: examiners fear they won't "be able to ensure appropriate quality standards"<p>This morning, the EPO-FLIER team, an anonymous group of European Patent Office employees who send independent information to private email addresses of colleagues and are not affiliated with the official staff union (SUEPO), distributed two PDF documents that I thought warranted publication with a view to the meeting of the Administrative Council of the European Patent Organisation on Thursday (December&nbsp;11).</p><p>I've previously reported on the <a href="http://www.fosspatents.com/2014/12/european-patent-office-examiners.html">fight of EPO staff for certain rights</a> (at least some of which are considered fundamental and inalienable human rights that require no discussion, let alone strikes or protests, anywhere in democratic Europe except in this context) and a <a href="http://www.fosspatents.com/2014/12/european-patent-office-pays-for-health.html">demonstration in Munich</a> last Tuesday. I won't be able to cover this labor conflict in all respects and from all angles, and you can find some interesting information on other sites, such as the <a href="http://www.worldipreview.com/article/epo-trouble-at-the-top">World IP Review</a> and the IPKat blog (which also reported on the <a href="http://ipkitten.blogspot.de/2014/12/in-suspense-about-european-patent.html"><u>alleged</u> suspension, without what would be considered due process in European countries, of a judge</a>, which I haven't been able to verify but which would be disconcerting if confirmed). But I've been saying for a long time that patent quality is key, so I'm concerned when I read an open letter from EPO employees warning that "EPO examiners will no longer be able to ensure appropriate quality standards" if a so-called New Career System (NCS) was put in place. Those staff members oppose an "entirely performance-based career proposal" and say it runs counter to core European Union policy positions. For example, the European Commission's <i>Industrial Property Rights Strategy for Europe of 2008</i> document noted that "[h}igh quality rights are an essential requirement for all aspects of the system – support for business including SMEs, facilitation of knowledge transfer and effective enforcement of rights to combat counterfeiting and piracy."</p><p>Here's the open letter to national delegations to the Administrative Council of the EPOrg (this post continues below the document):</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View EPO Examiners Can No Longer Ensure Appropriate Quality Standards on Scribd" href="https://www.scribd.com/doc/249487853/EPO-Examiners-Can-No-Longer-Ensure-Appropriate-Quality-Standards" style="text-decoration: underline;" >EPO Examiners Can No Longer Ensure Appropriate Quality Standards</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/249487853/content?start_page=1&view_mode=scroll&access_key=key-y55TwzowfrSPRZkx67LH&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7068965517241379" scrolling="no" id="doc_78979" width="100%" height="600" frameborder="0"></iframe><p>I don't have an opinion on examiners' pay and will never express one, except that these are obviously highly-qualified people (advanced technical education, training in patent law, and at the EPO they must be fluent in three working languages in addition to their native tongue). But regardless of <i>how much</i> these examiners earn, it's one of the most crucial questions of patent policy (in my opinion, at a level with or arguably even more fundamental than such questions as access to injunctive relief, damages theories, bifurcation etc.) whether quality or quantity is incentivized at the examination stage. Therefore, the above open letter warrants consideration.</p><p>On a completely nonjudgmental basis (except for opinions I've previously expressed) I'd also like to show you the latest "EPO-FLIER" (again, it's completely unofficial), which is entitled "The spirit of the regulations" and focuses on human rights and rule-of-law/governance questions:</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View EPO-FLIER 13 - The Spirit of the Regulations on Scribd" href="https://www.scribd.com/doc/249487726/EPO-FLIER-13-The-Spirit-of-the-Regulations" style="text-decoration: underline;" >EPO-FLIER 13 - The Spirit of the Regulations</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/249487726/content?start_page=1&view_mode=scroll&access_key=key-coZhjXu6N6Axe4tT7Ogh&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7068965517241379" scrolling="no" id="doc_4275" width="100%" height="600" frameborder="0"></iframe><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-43958968112257127272014-12-05T21:58:00.001+01:002014-12-08T18:59:09.483+01:00Cisco suing Arista over set of 500 commands: original interface material IS copyrightable<p>Cisco agrees with Google on a lot of patent-related issues (so do I), but strongly disagrees with it on interface-related copyright questions (so do I, too). That's one of my conclusions from having looked at the <a href="http://de.slideshare.net/Cisco/2014-1205-cisco-complaint-against-arista-copyright">copyright infringement complaint</a> Cisco filed today against Arista. Cisco <a href="http://blogs.cisco.com/news/protecting-innovation">simultaneously brought a patent suit and a copyright suit</a>, alleging "promotion of theft."</p><p>Google and the amici curiae (<a href="http://www.fosspatents.com/2014/11/buy-one-get-two-free-effs-approach-to.html">1</a>, <a href="http://www.fosspatents.com/2014/11/yawn-amicus-briefs-in-support-of.html">2</a>) supporting its Supreme Court petition in Oracle's Android-Java copyright case <i>incorrectly</i> claim that the industry at large had for a long time relied on the non-copyrightability of anything related to application programming interfaces (APIs). No matter how many IP professors and programmers the Electronic Frontier Foundation can persuade (or doesn't even have to persuade because they're Google employees or otherwise Google-aligned) to put their good names under bad claims, it's simply not true. Today's copyright infringement action by Cisco is just the latest example of how the IT industry has actually relied on copyright protection for <i>all</i> creative, expressive code (whether or not interface-related) ever since.</p><p>I said Cisco is just the latest example. Oracle <a href="http://www.fosspatents.com/2013/02/industry-leaders-creatives-academics.html">received overwhelming support from the software industry</a> last year in the form of amicus briefs submitted to the Federal Circuit. Cisco wasn't active at that time, but its Arista complaint is, silently and indirectly, a wholesale endorsement of Oracle's core positions on copyright.</p><p>If Cisco is right on this one (and I am already convinced that it is), the expression, organization and hierarchies of at least 500 multi-word commands from Cisco's command-line interface (CLI) is copyrightable. I don't have a position on whether Arista infringed, but Cisco alleges outright copying and is rather specific in its pleadings.</p><p>I have looked at Exhibit 1 to Cisco's copyright complaint (you can find it further below), which lists those 500 multi-word commands. On that basis I have a few observations to share regarding copyrightability:</p><ol><li><p>This stuff is expressive, original material to me. The authors of this set of multi-word commands could undoubtedly have written and structured it in a practically infinite number of different ways. That's why I believe this material does enjoy copyright protection under long-standing U.S. law. And it isn't deprived of copyright protection only because of someone's <i>subsequent</i> choice to provide programmers with a "familiar" interface.</p></li><li><p>Just like any body of copyrightable material, it obviously contains some elements that wouldn't be copyrightable if taken out of context and viewed absolutely separately (just like this blog post is composed of words and I don't own copyright in any one of those words, but in the text as a whole). For example, "ip host" all by itself isn't copyrightable. Same with "show inventory." Arista could have copied one or two of those and Cisco couldn't complain if that were the case. But when one looks at the whole list of 500 multi-word commands, many of which truly involve creative choices (for example, "show ip igmp snooping querier" or "spanning-tree potfast bpdufilter default"), the threshold for copyrightability is <i>easily</i> met.</p></li><li><p>While the threshold for copyright protection is a non-issue in my view for the 500 CLI multi-word commands Cisco is asserting against Arista, the degree of creativity that went into the 7,000 lines of Java API declaring code is undoubtedly far greater. Most Java function and variable names also consist of multiple words each, and then there are additional parameters. I believe there are strong arguments for saying that the average line from the Java API declaring code is more expressive than the average CLI command, but even if one disagreed with me and only considered them to be at a similar level, the Java API material would be far more massive and far more creatively-structured.</p><p>As for "massive," it's not about quantity being a substitute for quality; I'm saying this because the size of such a work has exponential implications for the number of alternatives that the authors could have chosen.</p><p>In a recent blog post I noted that <a href="http://www.fosspatents.com/2014/11/google-supporters-increasingly.html">Google's supporters increasingly recognize the flaws of the overturned ruling from the Northern District of California</a> (where Oracle filed in 2010 and Cisco filed today), and one of them (who demonstrates enormous strength and confidence by conceding he had overlooked one or more key issues when he originally sided with Google) <a href="http://ipbreakdown.com/blog/federal-circuit-feeds-us-some-humble-pie-oracle-v-google-reversed/">wrote that "[o]ne thing Oracle really had going for it [...] is the sheer size and complexity of the Java API library", going on to say that "surely somewhere in there is a spark of creativity."</a></p><p>As for "far more creatively-structured," those 500 multi-word commands are simply an alphabetical list, while the asserted Java APIs were taken from 37 <i>packages</i>, and the decision on which package should contain a particular element is also a creative act that simply doesn't occur when someone creates an alphabetical list. (Cisco would perhaps argue that even this alphabetical list has some sort of structure because, for example, one could view all multi-word commands starting with the same word, like "show", as a <i>kind of</i> package. But those Java API packages involve a more creative kind of structure.)</p><p>So, to put it that way, if Cisco prevails on its CLI claim, there's absolutely no way that Google is right with its non-copyrightability position in the Oracle case. (But <i>theoretically</i>--though I don't think that's where it is--the legal threshold could fit <i>comfortably</i> in between Cisco's <i>500</i> multi-word <i>commands</i> and the <i>7,000 lines</i> of Java API declaring code, in which case Cisco would lose and Oracle would prevail.)</p></li><li><p>Cisco's complaint disagrees with the "Google camp" in an additional, highly interesting way. While Google's supporters blame Oracle's appellate victory on the Federal Circuit and continue to claim that Ninth Circuit law supports their position and that the Federal Circuit allegedly got Ninth Circuit law (which it had to apply here) wrong, Cisco is demonstrably convinced that it will prevail if and when the case is appealed to the Ninth Circuit: if it had brought a combined patent and copyright complaint (as Oracle did, though patents are no longer at issue in that dispute), the copyright part would <i>also</i> have gone to the Federal Circuit in the event of an appeal, but Cisco filed a copyright complaint that is separate from the simultaneous patent infringement complaint, undoubtedly making the Ninth Circuit the future appellate forum.</p></li><li><p>One last observation. It has unfortunately become pretty common that patent holders allege "copying" even in cases that actually involve <i>independent</i> invention and <i>legitimate</i> kinds of imitation and, for the most part or entirely, <i>lawful competition</i>. I oppose that kind of stretch, though I do recognize that willful and reckless infringement does sometimes occur (and in those cases, "copying" isn't necessarily the word I would consider my first choice but may be somewhat appropriate). In <i>Oracle v. Google</i>, the patent case might have fared better under a different judge (even in the same district, thinking of Judge Koh, for example), but it's probably no coincidence that in cases involving <i>literal</i> copying, copyright is an even more powerful intellectual property right to enforce than patents. Cisco has just filed its two complaints and it remains to be seen where those cases go, but at this stage it's already clear that copyright is not just an afterthought but instead an absolutely central part of Cisco's litigation strategy.</p></li></ol><p>Here's Exhibit 1 to Cisco's copyright complaint with the list of those multi-word commands:</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-12-05 Exhibit 1 to Cisco v. Arista Copyright Infringement Complaint on Scribd" href="https://www.scribd.com/doc/249286688/14-12-05-Exhibit-1-to-Cisco-v-Arista-Copyright-Infringement-Complaint" style="text-decoration: underline;" >14-12-05 Exhibit 1 to Cisco v. Arista Copyright Infringement Complaint</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/249286688/content?start_page=1&view_mode=scroll&access_key=key-jUN4eQu3gJil5mV4MheY&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_67714" width="100%" height="600" frameborder="0"></iframe> <p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-35386279764492717192014-12-05T06:35:00.000+01:002014-12-05T06:50:08.208+01:00Appeal of first Apple-Samsung case could lead to 3rd California trial in that case (4th in total)<p>For a few years, Apple and Samsung used to meet in court very frequently when they were embroiled in cross-jurisdictional, intercontinental litigation. Those showdowns have become relatively rare thanks to a <a href="http://www.fosspatents.com/2014/08/apple-and-samsung-drop-all-non-us.html">mutual withdrawal of their lawsuits pending outside the United States</a>. But they still haven't put the U.S. part of the dispute behind them.</p><p>Yesterday the United States Court of Appeals for the Federal Circuit heard <a href="http://www.fosspatents.com/2014/03/that-was-quick-samsung-appeals-final.html">Samsung's appeal</a> of the district court ruling in the first <i>Apple v. Samsung</i> case originating from the Northern District of California. The $929&nbsp;million damages award (after a 2012 trial and a 2013 retrial) could be a significant part of the reason for why it's taking them so long to settle despite the fact that this litigation stopped serving a strategic purpose a while ago.</p><p>This appeal used to be a two-way street but <a href="http://www.fosspatents.com/2014/07/apple-drops-cross-appeal-forever.html">Apple dropped its cross-appeal</a> and decided to just focus on <a href="http://www.fosspatents.com/2014/08/apple-responds-to-samsung-appeal-of.html">defending the jury verdict</a>.</p><p>Yesterday's hearing took place precisely a year after the same appeals court heard Oracle's appeal of a non-copyrightability ruling (also from the Northern District of California). A year back the outcome was <a href="http://www.fosspatents.com/2013/12/oracle-apparently-winning-android-java.html">very predictable based on how the hearing went</a>. It's much harder, but not entirely impossible, to draw conclusions from the <a href="http://oralarguments.cafc.uscourts.gov/default.aspx?fl=2014-1335.mp3">official recording of yesterday's <i>Apple v. Samsung</i> hearing</a>.</p><p>The hearing lasted about an hour and a half, which it most likely wouldn't have (despite the high profile that this case has, or at least <i>had</i> until the ex-U.S. second-class settlement greatly reduced the perceived imporatnce of the overall dispute) if wholesale affirmance was a given.</p><p>It would be a somewhat risky bet to predict complete affirmance given that Samsung has raised a number of issues, a couple of which are very fundamental. Interestingly, Samsung's challenges to the validity of the patents-in-suit (particularly the '915 pinch-to-zoom API patent) weren't really discussed yesterday. The '915 patent was rejected by the USPTO's reexamination division (further to an anonymous request). Apple appealed (this is still a USPTO-internal appeal, not yet a Federal Circuit appeal). The examiner <a href="http://www.fosspatents.com/2014/07/us-patent-examiner-stands-by-rejection.html">still stands by the rejection decision</a>. A hearing was held on November&nbsp;19, and a decision by the Patent Trial and Appeal Board will come down in the weeks or months ahead. The PTAB decision will most likely be rendered before the Federal Circuit decision. If the USPTO affirms the rejection decision and the Federal Circuit agrees with Samsung that the district court should have held the '915 patent invalid, then that outcome all by itself -- and again, this is something that wasn't even discussed yesterday because there was so much on the agenda -- would make another California trial between these parties necessary. They already had a trial and a retrial in this case; another retrial would be the third trial just in that first case, and they also had a trial in a second case earlier this year (where <i>Apple</i> is actually seeking a retrial).</p><p>The issues that the hearing was all about were related to trade dress matters and design patent damages. Again, it has been easier in some other cases to predict the outcome based on a hearing. Still, based on how yesterday's hearing went, it seems reasonable to say the <i>relatively</i> most likely outcome is that at least one of those issues will lead to a partial retrial. Affirmance on both issues is least likely, and the probability of a reversal/remand concerning both may be a little higher than that of complete affirmance but seems far lower than that of a mixed ruling.</p><p>Another question that I routinely think about after an appellate hearing like this is whether there is a likelihood of the matter being appealed to the Supreme Court. In <i>Oracle v. Google</i> it was unsurprising that Google would try everything. In <i>Apple v. Samsung I</i>, the question of design patent damages looks most certworthy. The key question here is whether a design patent holder is really entitled to an unapportioned disgorgement of the infringer's profits even if other design elements and, especially, numerous non-infringing technical features are responsible for the largest part of those profits. As Samsung's counsel noted yesterday, those design patents didn't even relate to some of the most iconic design elements, such as the iPhone's Home button. And design is just a limited part of the equation when we're talking about a high-tech product. While I don't want to read too much into that remark by a judge at yesterday's hearing, it was basically said that the statute is what it is <i>even if</i> Samsung <i>was</i> right that an unapportioned disgorgement was "absurd". This seems to me to be an extremely interesting question of statutory construction, and should the Federal Circuit interpret the statute rather literally, then the Supreme Court would be reasonably likely to be interested in looking for a way to interpret and apply the statute in ways that reflect the reality of today's highly multi-functional gadgets. The Supreme Court wouldn't want to legislate from the bench either, but there are potential solutions to the problem of absurdity that can be reconciled with the statutes. If the Federal Circuit took an extremely patentee-friendly position on this one, the Supreme Court might reverse, as it did in some other patent cases.</p><p>But in order for the Supreme Court to even look at the case, it has to grant certiorari, and someone first has to request that. There's a significant amount of money involved, so I believe whichever party loses on design patents, a cert petition will be given serious thought.</p><p>but a settlement would resolve the whole issue. This leads to another question: is the issue of design patent damages important enough to one or both parties that their interest in potentially getting a Supreme Court decision is a strong disincentive for settling beforehand?</p><p>If Samsung lost on design patents in the Federal Circuit and brought a cert petition, countless companies in the tech industry and various other industries would be very grateful, but I don't think this matter is so critical to Samsung in the long run that it wouldn't settle with Apple on reasonable terms. For Apple, protecting its designs is very key, but if it prevailed in the Federal Circuit on this issue, there would be more to lose than to gain in the event the Supreme Court decides to review the matter. So for Apple the ideal exit strategy would probably be to settle before. If it settled before the Federal Circuit ruling, the hearing transcript could still be used as a deterrent for anyone to copy Apple's designs in the U.S. (outside the U.S., Apple's related assertions failed in some jurisdictions and had very limited, temporary impact only in Germany). So it would actually also make a lot of sense to Apple to settle before or, otherwise, shortly after the Federal Circuit ruling. Also, Apple never knows whether one day it may find itself on the receiving end of a design patent infringement case, and then Apple would definitely fight very hard against a disgorgement of unapportioned infringer's profits. If I were Apple, I would try to settle <i>before</i> the Federal Circuit ruling, but of course this depends on the terms Samsung would agree to. And no one knows what the parties' positions are.</p><p>This is just my thinking and the parties may view it very differently. So maybe the design patent disgorgement question will go all the way up to the Supreme Court. Meanwhile, the Federal Circuit appeal of the second California case would unfold.</p><p>It will take a few months before the Federal Circuit decision comes down. That's a lot of time for both parties to think hard about the benefit of moving on. This case is about really old products by the standards of this industry. If we were talking about intellectual property rights that still matter to newer products, then the list of accused products in the case would be secondary because a ruling could affect more recent and even future products in one way or another. In this first Apple-Samsung case, we're mostly talking about design-related issues that haven't resurfaced in years.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-43314675417325194752014-12-02T19:01:00.001+01:002014-12-03T08:38:27.750+01:00European Patent Office pays for health insurance of members of its oversight body, staff union says<p>As a follow-up to <a href="http://www.fosspatents.com/2014/12/european-patent-office-examiners.html">yesterday's post on a continuing strike by European Patent Office examiners</a>, I went to watch today's Munich demonstration. I figured I'd see a few hundred (of the EPO's 3,800 Munich-based) employees demonstrate, but the organizers announced a crowd of 1,100 at the beginning of their protest march from an EPO building to the Palace of Justice, and of 1,300 toward the end after other protesters, including members of technical boards of appeal (<i>i.e.</i>, in-house judges), had joined. According to the organizers from SUEPO, the EPO staff union, this made today's Munich demonstration "the largest event in the history of the EPO."</p><p>While I know that organizers like to overstate such figures, both numbers appeared very credible to me. The protest march was impressively long (even more so when considering temperatures just slightly above freezing and the light rain)--so long that it was impossible to have the whole crowd on a single picture, even at the destination where a few short speeches were given.</p><p>This picture shows a limited part of the initial gathering:</p><div class="separator" style="clear: both; text-align: center;"><a href="http://4.bp.blogspot.com/-5LkJYKUVEZo/VH31ZaI2ryI/AAAAAAAACAA/mgMSIhMPljE/s1600/14-12-02%2BEPO%2Bstaff%2Bprotest%2B-%2Bgathering.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="http://4.bp.blogspot.com/-5LkJYKUVEZo/VH31ZaI2ryI/AAAAAAAACAA/mgMSIhMPljE/s320/14-12-02%2BEPO%2Bstaff%2Bprotest%2B-%2Bgathering.jpg" /></a></div><p>From there, the crowd marched to today's destination, the Palace of Justice. First the protesters had to cross Hackerbruecke, a bridge that is similarly crowded only during Oktoberfest (it's the closest local train station to Theresienwiese, the Oktoberfest venue):</p><div class="separator" style="clear: both; text-align: center;"><a href="http://1.bp.blogspot.com/-pkeq5Evl-V0/VH32EixmvlI/AAAAAAAACAI/efdi5dyg6DI/s1600/14-12-02%2BEPO%2Bstaff%2Bprotest%2Bmarch%2Bover%2BHackerbruecke.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="http://1.bp.blogspot.com/-pkeq5Evl-V0/VH32EixmvlI/AAAAAAAACAI/efdi5dyg6DI/s320/14-12-02%2BEPO%2Bstaff%2Bprotest%2Bmarch%2Bover%2BHackerbruecke.jpg" /></a></div><p>I took the next picture a little later:</p><div class="separator" style="clear: both; text-align: center;"><a href="http://4.bp.blogspot.com/-zYops3b1PDE/VH32d4UgpdI/AAAAAAAACAQ/PyL8sKQjTb8/s1600/14-12-02%2BEPO%2Bstaff%2Bprotest%2Bmarch%2B-%2Bstreet.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="http://4.bp.blogspot.com/-zYops3b1PDE/VH32d4UgpdI/AAAAAAAACAQ/PyL8sKQjTb8/s320/14-12-02%2BEPO%2Bstaff%2Bprotest%2Bmarch%2B-%2Bstreet.jpg" /></a></div><p>You can find a couple of other photos, and measured commentary expressing a certain degree of concern, <a href="http://ipkitten.blogspot.de/2014/12/unrest-in-eponia-as-staff-take-to.html">on the IPKat blog</a>. A Bavarian broadcasting company (probably radio, maybe TV) was also present, and even before today's protest, Frankfurter Allgemeine Zeitung reported (the article, along with English and French translations, is <a href="http://www.suepo.org/public/ex14289cp.pdf">available here</a>) about "strange things going on" in Munich.</p><p>The FAZ article notes that the European Patent Organization (EPOrg) is run as a state within the state, an issue I mentioned yesterday. It's an autocracy that is above the law. The SUEPO activist leading the march said today that whenever EPO employees try to raise human rights issues in judicial proceedings, the EPO's lawyers routinely argue the EPOrg is an international organization that is not a signatory of the <a href="http://www.echr.coe.int/Documents/Convention_ENG.pdf">European Convention on Human Rights</a>, thus its employees (though they are all nationals and residents of member states of the Council of Europe, another non-EU body) don't enjoy the protection that goes with the European human rights charta. SUEPO proposes accession of the EPOrg to the Council of Europe as a solution to several (though not all) fundamental problems affecting EPO staff.</p><p>Wherever there is a lack or near-absence of checks and balances, two things inevitably happen:</p><ol><li>Whatever little may exist in the form of checks and balances will be further marginalized or eliminated. Case in point, the EPOrg <a href="http://www.suepo.org/public/news/ex11082cp.pdf">abolished an independent audit committee in 2011</a>. EPO president Battistelli said in a <a href="http://www.usinenouvelle.com/article/le-stratege-du-brevet-europeen.N182255">2012 interview (in French)</a> that in his entire political career he'd never enjoyed so much freedom, not having to worry about parliaments or governments. "It's us who sets the rules, discusses them, and negotiates them." (It's unclear whether "us" refers to him and the Administrative Council, or just to himself in the form of a <i>pluralis maiestatis</i>).</p></li><li><p>Such a deficient structure furthermore makes it all too tempting to create conflicts of interest for those who are meant to oversee the agency's dealings: the national public servants representing the governments of the EPO contracting states on the EPOrg's Administrative Council. One of the speakers at today's demonstration in front of the Palace of Justice said that the EPO recently started to pay for the health insurance of the national delegates to the Administrative Council.</p><p>That should actually be a big-time political scandal in Europe. I heard that Administrative Council meetings are a boon for some Munich-based doctors, particularly dentists, as national delegates (presumably from, relatively speaking, poorer European countries) go to see them while they are here. I also heard from a multiplicity of reliable sources that the president of the EPO can easily silence critics on the Administrative Council by either offering lucrative cooperation projects to their national patent offices if they support him or by threatening to withdraw funding for such projects if they don't.</p></li></ol><p>This labor dispute is, as I already explained yesterday, not about money but about fundamental rights. One protester held a sign that said "No intellectual property rights without civil rights" and that makes sense. Others warned against a lawless space on European (or, specifically, Bavarian) soil.</p><p>The only issue that was mentioned by the speakers in connection with compensation was that SUEPO opposes the idea of a performance bonus for examiners that could create a conflict of interest as examiners should be honest brokers between an inventor and the general public--an attitude that I like very much. As an alternative, SUEPO appears to prefer accelerated career paths based on the quality of someone's work.</p><p>Toward the end, the deeply-rooted lack of faith of many EPO employees in the current president was expressed loud and clear as significant parts of the crowd chanted, in French, "Battistelli démission." There are some indications that EPO governance has never been more problematic than under the current president, but as long as the underlying structural issues are not addressed, there's no guarantee that a different president wouldn't be worse. Overly close ties between members of the Administrative Council and the EPO president (whoever that president may be at any given point in time) are a particularly important part of the problem.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-53325742184111921152014-12-01T09:31:00.000+01:002014-12-01T21:00:15.358+01:00European Patent Office: examiners continue strike and take to the streets over human rights issues<p>While the average labor conflict is just about money, and occasionally about narrowly-defined working conditions, something remarkable is going on at the European Patent Office (EPO). An <a href="http://www.epo.org/news-issues/news/2014/20141127.html">ongoing strike</a> and related demonstrations are meant to "underline staff's claims to respect of the Rule of Law, Freedom of Association and to good faith negotiation of ongoing reforms."</p><p>There are reasonably credible complaints about the current EPO president ruling with an iron fist and denying affected staff representatives, after being fired for defending the rights of others, access to justice for the next ten years. I heard a horrible story of a French EPO examiner who (based on what I heard) committed no wrongdoing other than being active in the <a href="http://www.suepo.org/public/about">Staff Union of the European Patent Office (SUEPO)</a> and was "suspended" for that reason. Payments to him (a father of three if my sources are right) were frozen with immediate effect--at least significant parts of his salary. This would be unthinkable in Europe, where workers' rights are reasonably strong, including in Germany, where this incident occurred, if the EPO didn't enjoy "immunity" by virtue of being an international organization. It's an autocracy that operates its own internal jurisprudence, and it appears that EPO employees currently don't have (at least not in practical terms) access to a reasonably swift adjudication of labor disputes. The only recourse they have against the EPO's president is the <a href="http://www.suepo.org/public/ilo">International Labor Organization's Administrative Tribunal</a>, which is so clogged it takes about ten years to reach a decision (counting from the filing of a complaint).</p><p>Facing the risk of being left without some of their pay overnight and not having a realistic chance of reclaiming any of it in a decade, and having seen how someone else was escorted out of the building by security personnel before an announcement that he left "by mutual agreement," EPO staff is intimidated and allegedly subject to repression. Under these circumstances, the momentum behind the ongoing strike and the related protests is even more significant than it would normally be. Even the EPO itself acknowledges that, about two weeks ago, "2,538 staff representing 36.7% of the workforce" participated in the strike.</p><p>Recently 700 EPO employees took to the streets of Munich. That number was given by SUEPO, and a local newspaper, Süddeutsche Zeitung, also estimated a crowd of in the hundreds (<a href="http://www.sueddeutsche.de/wirtschaft/europaeisches-patentamt-aufstand-gegen-den-sonnenkoenig-1.2229665">German online article</a>, <a href="http://www.suepo.org/public/ex14288cp.pdf">German print article with English translation further below</a>). Tomorrow (Tuesday), demonstrations will take place in front of the French and Danish embassies in The Hague in support of two EPO employees "facing disciplinary procedures for their work as staff representatives." One of those employees is French (at a recent protest, there were signs that said "Hands off Aurélien"), and the other Danish. The demonstrations additionally take place in front of those countries' embassies because the European Patent Organisation (which runs the EPO) is led by a Frenchman, its apparently-controversial president <a href="http://en.wikipedia.org/wiki/Beno%C3%AEt_Battistelli">Benoît Battistelli</a> , and a Dane, Administrative Council chairman <a href="http://en.wikipedia.org/wiki/Jesper_Kongstad">Jesper Kongstad</a>. More protest will be expressed today in the form of a march from one of the EPO buildings in Munich, the city in which more than half of its nearly 7,000 employees work, to the local Palace of Justice.</p><p>At the heart of the issue is the leadership style of the EPO's recently-reelected president. To quote Wikipedia, Mr.&nbsp;Battistelli "is perceived by staff as being unduly autocratic and unsuited to a European intergovernmental body such as the EPO," and his management style has also been criticized in the Dutch newspaper <a href="http://www.telegraaf.nl/buitenland/22788695/__Battistelli_herbenoemd_bij__.html">De Telegraaf</a>, and by <a href="http://www.leparisien.fr/flash-actualite-economie/a-l-office-europeen-des-brevets-ambiance-deletere-et-president-conteste-30-03-2014-3722805.php#xtref=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FBeno%25C3%25AEt_Battistelli">Philip Cordery</a>, member of the French National Assembly). I've also found <a href="http://jeanyvesleconte.wordpress.com/2014/05/16/gouvernance-et-strategie-de-loffice-europeen-des-brevets/">this statement by a French senator</a> (in French) on <a href="http://icsfight4yourrights.blogspot.de/">another (English-language) blog I hadn't been aware of before today</a>.</p><p>Here in the Munich area, one can hear all sorts of stories about Mr.&nbsp;Battistelli, involving tax-saving strategies and favors the EPO is allegedly doing the members of the Administrative Council (public servants of the EPO's contracting states; they reelected Mr.&nbsp;Battistelli unanimously). Those are hard to verify. But what's apparent is that the EPO's governance structures have traditionally suffered from a severe lack or the near-total absence of checks and balances. The worst story of this kind doesn't even involve Mr.&nbsp;Battistelli but one of his predecessors from a long time ago. According to an email (published on the Internet back then) from an EPO employee to non-governmental organization <a href="http://www.ffii.org">FFII</a>, a SUEPO leader was kicked in the stomach by the then-president of the EPO. The female victim was hospitalized. The Munich police was not authorized to enter the EPO building because it's on diplomatic territory, so the culprit, protected by diplomatic immunity, couldn't be prosecuted for causing this bodily harm. Again, this was long before Mr.&nbsp;Battistelli's presidency, but it shows a structural problem.</p><p>To be clear, the EPO is not an agency of the European Union. Its contracting states include non-EU members such as Switzerland, and it's an international organization that was set up separately from what was then called the European Economic Community (about 40 years ago). However, the European Commission has observer status on the EPO's Administrative Council and has entrusted the EPO with examining and granting the future EU-wide Unitary Patent. As far as examiners' qualifications are concerned, the EU made the right choice. However, if the ongoing labor conflict over human rights issues such as freedom of association and the rule of law escalates further, it can become an institutional issue for Brussels, too, given its ever closer ties with the EPO. For example, critical questions might be raised by members of the European Parliament at some point.</p><p>Another unusual aspect of the ongoing strike is that a German patent law firm, Zimmermann &nbsp;&amp;&nbspPartner, expresses its support for EPO examiners "in their legitimate request for fundamental rights" on the firm's <a href="http://zimpat.com/">landing page</a> and, in greater detail, on a <a href="http://www.zimpat.com/en/strike/page.html">dedicated page</a>. The firm states clearly, among other things, that it finds "management decisions against European human rights inacceptable." On this blog, Zimmermann has been mentioned a few times because of its representation of Samsung in its German Apple lawsuits (Apple was unable to defend a single patent claim here). I've also been able to research work of that firm on behalf of various suppliers to the automotive industry, <a href="http://www.medtronic.com/">Medtronic</a> (the world leader in medical devices), and <a href="http://www.kimberly-clark.com/">Kimberly-Clark</a>. It's probably unprecedented for a firm to take sides in an internal dispute of a patent office. (It's also the first time for me to write about this kind of subject.)</p><p>The EPO appears to attribute all of the staff's activism to resistance against necessary reforms. There may indeed be a need for reform, but the number one item on the reform agenda should probably be governance and the rule of law.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-88673644155665047142014-11-26T20:26:00.000+01:002014-11-26T20:29:43.924+01:00Near-automatic injunctions raise concerns at hearing on rules for European patent court<p>A hearing was <a href="https://www.era.int/cgi-bin/cms?_SID=48f7b8e7610d5b3ae32446fcc569b222deba1ac600356837680052&_sprache=en&_bereich=artikel&_aktion=detail&idartikel=125041">held today at the Academy of European Law in Trier, Germany</a>, on the rules of procedure for Europe's future Unified Patent Court (UPC), as I mentioned last week when I <a href="http://www.fosspatents.com/2014/11/draft-rules-for-european-patent-court.html">commented (not too positively, to be honest) on the latest draft rules</a>. I followed it over the Web. To put it this way, the hearing went very well for those advocating a more <i>eBay v. MercExchange</i>-like standard, and there <i>is</i> a reasonable chance of improvement when more EU member states take and state their official positions in the months ahead.</p><p>The last part of the hearing before the lunch break was all about access to injunctive relief and the related judicial discretion. Dr. Johannes Karcher, a former judge at the Federal Patent Court of Germany and now an official at the Federal Ministry of Justice as well as the chairman of the legal group of the UPC Preparatory Committee, explained that judges would, in principle, enjoy discretion with respect to injunctions, but the question was the extent of such discretion. And he was clear that discretion should "only be exercised under exceptional circumstances."</p><p>As at least one other speaker did after him, Mr.&nbsp;Karcher argued that <a href="http://www.fosspatents.com/2014/11/european-advocate-general-recommends-to.html">last week's opinion by Advocate General Wathelet in a <i>Huawei v. ZTE</i> standard-essential patent case</a> affirmed that access to injunctions is a cornerstone of the patent system. It's true that AG Wathelet stated that seeking an injunction cannot, in and of itself, constitute abusive conduct. That was apparently also the European Commission's conclusion when it settled the Samsung FRAND investigation. By AG Wathelet's standard, there is no way the Commission could have fined Samsung for what it had done because Apple had taken none of the steps the AG considers necessary for a defendant to take in order to be considered a seriously willing licensee. Neither had Apple made a formal counterproposal on FRAND terms nor had Apple requested a FRAND determination (rate-setting decision) by a court of law or an arbitration panel. While the AG didn't state an opinion on ZTE's 50-euro-per-patent licensing offer, it was clear between the lines that Huawei's pursuit of injunctive relief was also above board, though ZTE could, if the court adopted the AG's recommendation (as it does most of the time), simply trigger a rate-setting proceeding in order to avoid a sales ban. The AG's opinion is a win for SEP holders in the sense that not only their own conduct but also the way the defendant behaves is part of the equation. I had advocated for a long time the proposal that only the SEP owner's FRAND compliance should matter, but I recognize that the Federal Trade Commission, the Department of Justice, the European Commission and now AG Wathelet all determined that an implementer of an industry standard must also demonstrate good faith conduct and I accept that this is now a requirement around the globe.</p><p>But the question in connection with the rules of procedure for the UPC is not whether an injunction request per se constitutes anticompetitive conduct no matter what the alleged infringer does or does not do. The outcome of <i>Huawei v. ZTE</i>, barring a surprise, is <i>not</i> going to be an injunction (because ZTE is too smart to let that happen). By contrast, the latest draft rules of procedure for the UPC were accompanied by an explanatory document, which drew criticism from multiple intervenors at today's hearing, that said injunctive relief would be denied only under "very exceptional circumstances." The way I see it, those draft rules of procedure are reconcilable with the AG's <i>Huawei</i> opinion only if one takes a particular passage out of context and twists and turns it, but not if one asks the question of whether the AG endorsed the notion of injunctive relief being available almost 100% of the time.</p><p>The first intervenor was a spokeswoman for the UPC Industry Coalition on whose open letters I've previously <a href="http://www.fosspatents.com/2014/02/growing-industry-coalition-urges-eu.html">reported</a>. She noted in the introductory part of her intervention that <a href="http://www.fosspatents.com/2013/09/smartphone-patent-foes-other-tech-firms.html">some of the key members of this broadbased coalition are actually embroiled in (particularly smartphone-related) litigation against each other</a>, which means the group is interested in a balanced regime as opposed to being exclusively on the side of right holders or alleged infringers.</p><p>Unfortunately there was a technical problem with the official webstream during that intervention (and not only then). Therefore I missed parts of the intervention, but I still heard when she said that the group is in favor of a more flexible and balanced standard. It appeared to me that the UPC Industry Coalition's concerns relating to the 17th draft rules of procedure are pretty much the same as mine.</p><p>Some of the intervenors also pointed out the problem with bifurcation (cases in which a validity determination could come down after an injunction is granted and enforced). A Dutch association said that there was a diversity of positions among its members and there may be a need to make adjustments after a few years with respect to such issues as bifurcation.</p><p>Those concerns and some closely-related ones were also voiced by various other intervenors, including, among others, a representative of the <a href="http://www.gsma.com/">GSMA</a> wireless industry association and a representative of a French software industry association with 350 member companies, most of them small and medium-sized companies. </p><p>A French judge (who was sitting in the audience and not on the panel along with those judges serving on or advising the Preparatory Committee) complained that there was a risk of a famework that would exceedingly restrict judicial discretion. Not long after her intervention, Paul van Beukering, a Dutch ministry official who is the chairman of the Preparatory Committee, stressed that this process was stil at the drafting stage and that a very important part of the process would begin only after more EU member states have been able to comment, which would happen only after the hearing. It appeared to me that Mr. van Beukering wanted to pacify the numerous and vocal critics of the latest draft by suggesting that there was still room for improvement.</p><p>Several members of the Prepatory Committee's legal and expert groups defended the current draft and called on critics to "have confidence in the court." The judges on the panel were clearly interested in preserving a maximum of discretion, but I think a balance must be struck (and is not struck by the 17th draft rules) between judicial discretion on the one hand and reasonable assurances to industry (including companies of all sizes) on the other hand. I frankly can't see how a statement in the explanatory document that says injunctions would be denied only "under very exceptional circumstances" serves either purpose. It's bad news for discretion as much as it is for businesses.</p><p>Also, I can't see why an <i>eBay</i>-like standard would place a painful restriction on judicial discretion. Judges at U.S. district courts and the Federal Circuit actually enjoy tremendous discretion thanks to <i>eBay</i>.</p><p>I would like to highlight a very good idea that Judge Dr. Klaus Grabinski from the Federal Court of Justice of Germany (who also serves on the UPC Preparatory Committee) mentioned in his response to criticism of the latest draft. While I don't think this idea is sufficient to address the concern over disproportionate injunctions, it is a useful one and would be worth being mentioned in a future draft of the rules of procedure. Judge Dr. Grabinski noted that if there is concern over the commercial impact of injunctive relief affecting a highly multifunctional mobile device only because of an infringement of a minor feature, it would be possible to order an injunction but to simultaneously stay it for a significant period of time in order to allow the defendant to implement a workaround. Such transitional periods have been discussed in the U.S. on many occasions and even the U.S. International Trade Commission, whose remedy is purely injunctive (import bans), has in some cases (such as an <i>Apple v. HTC</i> dispute) granted grace periods to make modifications. The mere fact that Judge Dr. Grabinski discussed this possibility in public and believes it is reconcilable even with the current draft rules of procedure (in conjunction with the related international agreements and treaties) is good news, especially since it comes from a high-ranking judge from a country in which injunctive relief is a near-automatic remedy for patent infringement. But unless the rules of procedure are improved, there's a risk that this will just remain a nice idea but that the court's practice, at least in cases brought before a local German division, will give patentees (even those who can only claim rights to minor features) excessive leverage.</p><p>Those who promote balance and reasonableness will have to work hard and smart on the lobbying front to achieve their stated goals, but they should take encouragement from today's hearing (though the challenges were also noticeable).</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-25195687953534339072014-11-26T05:49:00.000+01:002014-11-26T05:54:52.452+01:00U.S. judge awards Apple undisclosed royalties if Samsung infringes certain patents in the future<p><b>[Update]</b> Just after this post went live, Samsung filed a notice of appeal. Apple will do so pretty soon, too. <b>[/Update]</b></p><p>Since <a href="http://www.fosspatents.com/2014/08/apple-and-samsung-drop-all-non-us.html ">Apple and Samsung agreed in August to drop all patent infringement actions against each other outside the U.S.</a>, there has been a much lower frequency of <i>Apple v. Samsung</i> news. It's now just about limited amounts of money (relative to the size of the companies involved) and whether or not Apple will get a face-saving exit from what was once intended to be a "thermonculear war" on Android.</p><p>Next week there will be an interesting appellate hearing. On December&nbsp;4, the Federal Circuit will hear the parties' argument in Samsung's appeal (<a href="http://www.fosspatents.com/2014/07/apple-drops-cross-appeal-forever.html">Apple dropped its cross-appeal</a> in July) of the final judgment in the first Samsung case. With support from <a href="http://www.fosspatents.com/2014/05/27-law-professors-support-samsungs.html">27 U.S. law professors</a>, Samsung is trying to get the $929&nbsp;million damages amount in that first case reduced. The single biggest issue is the disgorgement of infringer's profits that U.S. patent law allows with respect to design patents.</p><p>In mid-December Samsung will respond to Apple's appeal of the <a href="http://www.fosspatents.com/2014/08/judge-denies-apple-bid-for-sales-ban.html">denial of a sales ban</a> in the second California litigation between these parties. Apple <a href="http://www.fosspatents.com/2014/10/apple-fighting-samsung-in-two-us-courts.html">appealed that denial even before the final judgment in that case</a>. It also tried, unsuccessfully, to speed up proceedings by asking the Federal Circuit to reconsider an order that granted Samsung a (customary) extension to respond. And it could now happen that the Federal Circuit will hear Apple's appeal of the injunction denial together with the parties' upcoming (we can set our watches by them) cross-appeal of the final judgment on the merits in the same case. That final judgment came down late on Tuesday by California time. It would make sense for the appeals court to discuss and adjudge the underlying liability issues and Apple's request for an extraordinary remedy at the same time.</p><p>In order to bring their appeals on the merits, Apple and Samsung had to wait for a formal final judgment in that second California case. Post-trial clean-up following the <a href="http://www.fosspatents.com/2014/05/apple-wins-119-million-in-patent.html">$119&nbsp;million verdict</a> (a disappointment for Apple, which demanded about 20 times as much) was already complete in September when Judge Koh <a href="http://www.fosspatents.com/2014/09/judge-declines-to-overrule-california.html">denied Apple's request for a retrial</a> and declined to overrule the jury in any significant way in either party's favor. <b><i>Relatively speaking</i></b>, <a href="http://www.fosspatents.com/2014/09/judge-determines-samsung-did-not.html">the finding that Samsung did not willfully infringe Apple's slide-to-unlock patent</a> (even the jury had not found any willful infringement of any other patent claim-in-suit) was the most important post-trial decision. But the final judgment couldn't come down without firstly adjudicating <a href="http://www.fosspatents.com/2014/09/apple-asks-court-to-order-samsung-to.html">Apple's request for ongoing (postjudgment) royalties</a>, filed shortly after the denial of injunctive relief.</p><p>Postjudgment royalties only come into play if products sold in the future are actually found to infringe a patent on which a party prevailed. While Judge Koh has awarded Apple some undisclosed per-patent per-product figures on Samsung products that might infringe any or all of the three patents on which Apple prevailed at trial (but pending appeal), the court has not determined that Apple is <i>actually</i> entitled to royalties on Samsung's future U.S. sales--just <i>potentially</i>. And Samsung disputes that there is any continuing infringement, as the following passage from the order on Apple's ongoing-royalties motion recaps:</p><blockquote><p>"Samsung claims that there is no need for continuing remedies because it no longer infringes any of the '172, '721, and '647 Patents. [...] According to Samsung, '[n]o Samsung product released since 2012 has even been accused of infringing the '172 or '721 patents,' and 'Samsung long ago designed around these patents.' [...] As to the '647 Patent, Samsung represents that 'post-verdict sales of the accused products in this case have already ended,' and that the only version of the Galaxy S III product on sale 'incorporate[s] different code' than the relevant infringing source code."</p></blockquote><p>Judge Koh agreed with Apple that it had not waived its right to obtain postjudgment royalties. She found that all patent holders who fail to win an injunction (but generally seek royalties in a given case) are entitled to ongoing royalties. As for the amounts, while those are redacted out in the public version of the order, it appears that she agreed with Apple to a large extent, but that's speculative. And she granted Apple's request (though some courts have denied such requests) for ongoing royalties relating not only to the (rather old) products presented at the trial earlier this year but also to future products that are "no more than colorably different" from the adjudged ones. But <b><i>it doesn't matter</i></b> if Samsung is right that it no longer infringes anyway.</p><p>If Apple indeed believes that there is any ongoing infringement, then the question of whether there was any postjudgment infringement will have to be decided by the court. Apple would have to prove not only that there was a postjudgment infringement but also that such infringement was of the same kind as an infringement previously identified by the jury. Otherwise a new decision on the merits would be needed, which would require a whole new lawsuit and another trial.</p><p>Should Apple bring any such claims, then we may find out at that time what per-product amounts Judge Koh awarded and decided to hide from the public. Those numbers will likely come to light during the appellate proceedings anyway.</p><p>Here's the order, which issued even without a hearing because Judge Koh wanted to close this case (for now) and maybe also wanted to make it possible for the Federal Circuit to consolidate the different appeals (injunction denial and liability issues) from this case:</p><p style=" margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block;"> <a title="View 14-11-25 Order Granting in Part Apple&#x27;s Motion for Ongoing Royalties on Scribd" href="https://www.scribd.com/doc/248270369/14-11-25-Order-Granting-in-Part-Apple-s-Motion-for-Ongoing-Royalties" style="text-decoration: underline;" >14-11-25 Order Granting in Part Apple&#x27;s Motion for Ongoing Royalties</a> by <a title="View Florian Mueller's profile on Scribd" href="https://www.scribd.com/Florian_Muelle_439" style="text-decoration: underline;" >Florian Mueller</a></p><iframe class="scribd_iframe_embed" src="https://www.scribd.com/embeds/248270369/content?start_page=1&view_mode=scroll&access_key=key-zCRlk5Y7YBmGJuCWFxNZ&show_recommendations=true" data-auto-height="false" data-aspect-ratio="0.7729220222793488" scrolling="no" id="doc_47229" width="100%" height="600" frameborder="0"></iframe><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-60867306105187199432014-11-21T10:21:00.001+01:002014-11-21T10:34:20.846+01:00Google and Android OEMs apparently close to settlement with Rockstar over ex-Nortel patents<p>About a year after the Rockstar Consortium's <a href="http://www.fosspatents.com/2013/11/failed-44-billion-bid-for-nortel.html">Halloween 2013 lawsuits</a> against Google and a host of Android device makers, and only days after a $188&nbsp;million settlement between Rockstar and Cisco became known, the most likely outcome is now that Rockstar's pending cases against Google and various Android OEMs will be settled at a relatively early procedural stage.</p><p>Four days ago, Rockstar filed an unopposed motion in its Google case (over search engine patents, which is separate from the Android cases) for a 45-day stay, which was subsequently granted. The motion said the following about the current state of affairs:</p><blockquote><p>"[O]n November 12, 2014 a binding Term Sheet was executed that settles, in principle, all matters in controversy between the parties. [...] [T]he Term Sheet is [being] reduced to a definitive agreement. [The 45-day stay] is necessary due to the complexity of the transaction and the number of additional parties whose claims are concurrently being resolved."</p></blockquote><p>There are no additional parties to the case over search engine patents besides Rockstar, its NetStar Technologies subsidiary, and Google as the sole defendant. However, there are many parties to the Android cases (devices makers like Samsung, LG, HTC, and ZTE), making a comprehensive settlement involving not only search engine but also wireless patents the only plausible interpretation of that passage.</p><p>Absent a settlement, all of the key issues in the Android context <a href="http://www.fosspatents.com/2014/10/rockstar-attack-on-android-to-be.html">would be resolved in the Northern District of California</a>, the venue preferred by Google and its partners. In the declaratory judgment action in California, a report was filed in early November, saying that the parties engaged in court-ordered mediation but reached no settlement. However, it is possible that the mediation meeting nevertheless had a positive effect. It probably also helped the parties to know in which court the infringement and validity determinations would be made.</p><p>It would be out of character for Google to make a huge payment at an early stage of a patent litigation (though there's always the possibility of something happening for the first time in history). It's also unlikely that pretrial discovery has given the parties definitive clarity about the likely outcome. So I can't imagine that the impending settlement would be a win across the board for Rockstar. The two most likely scenarios are either a win-win (Google and its partners can put this thing behind them for an amount that's worth it while Rockstar can produce some revenues that help the acquirers of Nortel's patents offset some of their costs) or a set of terms under which Rockstar lets Google and its partners off the hook at a rather low cost. Should the latter be the case, then it would most likely be attributable to dwindling support for Rockstar's lawsuits among its owners.</p><p>While no single shareholder (not even Apple, which contributed most of the funding) will be singlehandedly in the position to tell Rockstar's management what to do, it's possible that a couple of shareholders have demanded that those cases be settled. Protracted and potentially acrimonious litigation could have resulted in negative publicity for Rockstar's owners (a key difference between Rockstar and "patent trolls" who have no affiliation at all with any operating company).</p><p>Also, Rockstar's management and/or shareholders may have found Google's proposed terms more acceptable than initially. After all, <a href="http://www.fosspatents.com/2014/10/analysis-of-222-smartphone-patent.html">smartphone patent lawsuits typically don't give plaintiffs tremendous leverage</a>.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-17298549063416101372014-11-20T12:01:00.000+01:002014-11-20T12:41:16.307+01:00European Advocate General recommends to raise the bar for injunctions over FRAND-pledged SEPs<p>Last year, the Landgericht Düsseldorf (Dusseldorf Regional Court) <a href="http://www.fosspatents.com/2013/03/german-court-refers-huawei-zte-standard.html">referred a set of questions relating to injunctive relief over FRAND-pledged standard-essential patents (SEPs) to the Court of Justice of the European Union</a> and stayed a <i>Huawei v. ZTE</i> litigation pending the CJEU's opinion. The hearing was recently held (I didn't attend due to my changed focus), and today the recommendations of Advocate General Melchior Wathelet were published. There is an <a href="http://curia.europa.eu/jcms/upload/docs/application/pdf/2014-11/cp140155en.pdf">English-language press release</a> but not yet an English translation of the full document (at least not when I last checked). The official language of the proceedings is German, and that of the AG's recommendations is French.</p><p>Not all but most of the time, the European Court of Justice (which is what the CJEU is still referred to, now unofficially) adopts the AG's recommendations, and I believe that would be good news int his case.</p><p>I've read the recommendations, and here's my first takeaway:</p><ol><li><p>The AG's recommendations are consistent with the ways in which I have, for years, disagreed with the way German regional and higher regional courts applied the <a href="http://www.fosspatents.com/2012/02/apples-iterative-approach-to-frand.html#orangebookstandard"><i>Orange-Book-Standard</i> ruling</a> by the Bundesgerichtshof (Federal Court of Justice) to cases involving FRAND-pledged SEPs. If the AG's recommendations are adopted, the bar for injunctions over FRAND-pledged SEPs will be raised <b><i>far, far above</i></b> the recent practice by German courts, and it will certainly not be lowered as compared to the practice by UK and Dutch courts. In the Netherlands, antitrust law was not previously applied to these cases, but this may now be the case going forward.</p><p>The worst part of the German application of <i>Orange-Book-Standard</i> that the AG disagrees with is that some German courts restricted the rights of defendants to an unreasonable extent. Those judges said that if you want to benefit from a FRAND promise, you have to take a license and must not challenge the validity of the patent-in-suit (though most patents in this field are invalidated or narrowed when challenged) and cannot defend yourself against the infringement allegations--or else an injunction will issue. The AG's recommendations clearly leave all options to defendants. The approach by some German courts was "you pay up or else" and they denied injunctive relief only if a royalty offer was so high that there was no way the patent holder could have asked for even one cent above it.</p></li><li><p>If the AG's recommendations are adopted, holders of FRAND-pledged SEPs can forget about the possibility of obtaining quick (sometimes within 10 months of filing a complaint) injunction orders by German regional courts over FRAND-pledged SEPs because a defendant will have the option to request a FRAND rate determination by a court or an arbitration panel and no injunction will issue in the meantime.</p><p>The AG's recommendations require the patent holder to make a licensing offer to the alleged infringer, and the defendant to make a reasonable counterproposal, but in many cases both parties will take extreme positions with a view to a future FRAND determination.</p></li><li><p>Relatively speaking, the best news here for SEP holders is that they will have the opportunity to argue in court against any claim or assumption that ownership of a SEP gives them monopoly power. This could be an opportunity for SEP holders to still obtain injunctive relief, but the hurdle is likely going to be reasonably high, especially if the standard in question is as key as UMTS or LTE.</p></li><li><p>The AG's recommendations demonstrate a pragmatic approach and a good understanding of commercial realities by saying that implementers of standards do <b><i>not</i></b> have to seek a license prior to using the patents that read on it (because there's too many of them to reasonably expect anyone to clear and secure all rights beforehand): it's perfectly reasonable for companies to go ahead and implement a standard and to sort out licensing issues only if and when an infringement assertion is made. That is also a key aspect that some German judges viewed differently from the European AG.</p></li><li><p>While the AG's recommendations do not endorse the most extreme interpretation of the <a href="http://www.fosspatents.com/2012/12/european-commission-issues-statement-of.html">European Commission's December&nbsp;2012 press release on the Statement of Objections (SO) in the Samsung case</a>, according to which a totally unspecified willingness to negotiate would have been sufficient for an infringer to avoid injunctive relief, they are materially consistent with the structure of <a href="http://www.fosspatents.com/2014/04/eu-settles-sep-antitrust-case-with.html">the European Commission's settlement with Samsung</a>. Due to the settlement, that matter never arrived at the CJEU, but the aforementioned press release was the key reason for which the Dusseldorf Regional Court prudently presented its questions to the CJEU. (By the way, the presiding judge who made this decision, Ulrike Voss ("Voß" in German), has meanwhile been promoted to the appeals court, the Oberlandesgericht Düsseldorf.) So in practical terms, this CJEU proceeding is also about the issues at the heart of the Apple-Samsung matter.</p></li><li><p>In terms of whose parties' past behavior is endorsed, the AG's recommendations lend legitimacy to the pursuit of injunctive relief by Huawei (against ZTE) and Samsung (against Apple), even though the AG's recommendations would make it easy for defendants to avoid injunctive relief in the end. The AG does not comment on whether <a href="http://www.fosspatents.com/2013/02/huawei-and-ztes-lawyers-fight-over.html">ZTE's 50-euro royalty proposal</a> was reasonable, but between the line it's clear that it wasn't, and my guess is that ZTE will now seek a FRAND determination by a court of law or an arbitration panel. As for Apple, it's clear now that the positions Apple took in court in the Samsung cases were too extreme in several respects. Apple had basically argued that Samsung wasn't entitled to injunctive relief under any circumstances as long as Apple was willing to have talks (Apple's counsel said so explicitly in the Mannheim court), and that's not what the AG considers to be fair. AG Wathelet does believe that someone must be seriously interested in taking a license.</p></li><li><p>Earlier today I <a href="http://www.fosspatents.com/2014/11/draft-rules-for-european-patent-court.html">wrote about the latest draft rules for Europe's future Unified Patent Court, which make injunctions a given in virtually all cases in which an infringement is identified</a>. It's not clear to me how the Unified Patent Court would apply European law if (a) the current draft rules were adopted (which I hope and believe they won't) and (b) the AG's recommendations were adopted by the CJEU (which I hope and believe they will). Critics of the UPC have been saying for a long time that the CJEU should have the final say just the way the Supreme Court of the United States can overrule the Federal Circuit. What will the UPC do about FRAND? That question may very well come up at next week's hearing.</p></li><li><p>The AG argues that holders of FRAND-pledged SEPs have less leverage than owners of patents that read on de-facto standard without FRAND rules. That's the basis on which he distinguishes cases like <i>Huawei v. ZTE</i> from the German <i>Orange-Book-Standard</i> case, in which there was no FRAND pledge. If there's anything in the AG's opinion that I don't consider good policy, it's this. It's effectively an incentive for standard-setters not to make FRAND promises in the first place. Maybe the AG was being very political here and was just looking for a way to avoid an outright disagreement with the Federal Court of Justice of Germany. By saying that <i>Orange-Book-Standard</i> shouldn't apply to FRAND-pledged SEPs, the disagreement between the European AG and German case law is limited to decisions by lower courts, but the result could be problematic. Some of this will affect future debates over European horizontal agreement guidelines.</p></li></ol><p>I'll certainly comment on the CJEU's opinion when it is handed down. If I find additional interesting things in the AG's recommendations after re-reading them, I may blog about this landmark case again even before the actual ruling.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.comtag:blogger.com,1999:blog-5097323804696777140.post-77567008093173002882014-11-20T10:51:00.000+01:002014-11-27T13:41:35.421+01:00Draft rules for European patent court: injunctive relief an automatic remedy for infringement<p>When then-U.S. Secretary of Defense Donald Rumsfeld made a distinction between the <a href="http://en.wikipedia.org/wiki/Old_Europe_%28politics%29">"Old Europe"</a> and the "New Europe" (including countries like Poland), there was a lot of (understandable) outrage. Unfortunately, some of the people shaping Europe's patent policy are now pushing for a <b>Stone Age</b> approach that makes patent injunctions a given in any case in which an infringement is identified, more than eight years after the <i>eBay v. MercExchange</i> ruling by the U.S. Supreme Court and also running completely counter to the tradition of several European jurisdictions (such as the UK and the Netherlands) in which judges have enjoyed significant discretion concerning patent remedies.</p><p>At a time when U.S. case law has upped the ante for patent trolls in limited but useful respects and <a href="http://patentlyo.com/patent/2014/11/update-patent-reform.html">U.S. lawmakers (now that the Republican Party holds a majority in both houses of Congress) are preparing more anti-troll reform legislation for 2015</a> (which President Obama will almost certainly sign), Europe is going in the completely opposite direction. And while this was not enough, there had at least been some <a href="http://www.fosspatents.com/2014/03/new-draft-rules-for-future-european.html">temporary improvement in the spring</a>: the 16th draft rules (the draft before the latest one) at least contained some language reminiscent of the balance-of-harms <i>eBay</i> factor.</p><p>While I'm not involved with the related lobbying efforts (I haven't done any lobbying in more than seven years), I strongly suspect that companies with a failed or declining operating business in the ITC space like Nokia and Ericsson are responsible for this. I've also heard through the grapevine that a German official (from the Ministry of Justice, not a judge to be clear) has been a key proponent of troll-friendly rules.</p><p>I'm very surprised that the industry coalition that <a href="http://www.fosspatents.com/2013/09/smartphone-patent-foes-other-tech-firms.html">first raised concerns 14 months ago</a> and <a href="http://www.fosspatents.com/2014/02/growing-industry-coalition-urges-eu.html">reinforced its message earlier this year</a> hasn't spoken out yet on the latest (17th) draft rules of procedure for the UPC, but it also appeare a bit slow in the past, though maybe it will still get something done in time for <a href="http://www.unified-patent-court.org/news/82-oral-hearing-on-the-17th-draft-of-the-rules-of-procedure-of-the-unified-patent-court">next Wednesday's official hearing in the German city of Trier</a>.</p><p>Considering that the previous draft represented at least a step in the right direction, I was like shell-shocked when I read the following passage from the <a href="http://www.unified-patent-court.org/images/documents/Digest_Legal_Group_17th_Draft_RoP.PDF">official explanatory notes</a> for the latest draft:</p><blockquote><p>"Where the Court finds an infringement of a patent it will under Article&nbsp;63 of the Agreement give order of injunctive relief. Only under very exceptional circumstances it will use its discretion and not give such an order."</p></blockquote><p>That's part of the explanation of the deletion of Rule 118.2, which referred to <i>eBay</i>-like considerations. So the intention is that all infringements will result in inunctions except "under very exceptional circumstances." Even "exceptional" would mean "very rarely," but "very exceptional" means "hardly ever."</p><p>There are cases in which injunctive relief is the most appropriate remedy for patent infringement. But many of today's technology products are so multifunctional that unlimited access to injunctive relief will give patent holders undue leverage. For example, if Mercedes, BWM or Audi had to stop manufacturing and distributing an entire car only because of a need to work around a patent covering a very minor feature of the navigation system, the cost of complying with a court order would far exceed the true value of the asserted patent. That discrepancy invites arbitrage by trolls.</p><p>Those who favor such rules don't work to protect innovation or to strengthen law enforcement. They may mean well (at least for their profession, though I'm not sure they even have the best in mind for the economy at large), but at the end of the day they pave the way for rampant abuse with disastrous economic consequences.</p><p>Europe has an innovation problem--Nokia is a good example. If Europe now tries to just strengthen patent enforcement for the losers in the marketplace (Nokia being the most extreme example), the net effect is not going to be more innovation. Instead, even more European innovators will emigrate to Silicon Valley.</p><p>While the deletion of Rule 118.2 (which should not only have been kept but even strengthened) is disconcerting, there is now some (but still very insufficient) progress in a related context--bifurcation. Rule&nbsp;40 now says that if an infringement hearing is scheduled and an infringement case is not stayed despite an ongoing revocation action, "the judge-rapporteur of the panel of the central division shall endeavour to set a date for the oral hearing on the revocation action prior to the date of the oral hearing of the infringement action."</p><p>Obviously, "shall endeavour" is pretty weak, and the explanatory notes make this even clearer: </p><blockquote><p>"New Rule 40(b) will not to acceleration in <u>all</u> cases where counterclaims for revocation are referred to the central division -- only cases where the parallel infringement action is <u>not</u> stayed will be accelerated; in practice, the synchronisation of the calendars remains within the discretion of the judge-rapporteur ('shall endeavour')."<p><p>(emphasis of "all" and "not" in original)</p></blockquote><p>This is a step in the right direction but still unacceptable because it means parties to a dispute will have to negotiate a settlement without the defendant knowing for sure that the invalidity defense will be adjudicated before an injunction issues. The "injunction gap" is a real issue as I showed in my <a href="http://www.fosspatents.com/2014/10/analysis-of-222-smartphone-patent.html">study of the final and preliminary outcomes of 222 smartphone patent assertions</a>: there was not even one situation in all the German cases among the lawsuits I analyzed in which an infringement proceeding was stayed and a patent later upheld, but there were multiple cases in which a patent later invalidated by the Federal Patent Court of Germany was enforced for an extended period of time in each case (for example, Motorola got to enforce a synchronization patent against Apple for 19 months).</p><p>My analysis was smartphone-focused, but other studies with a broader focus have also shown that most European patents are actually invalidated or narrowed when they come to judgment in the Federal Patent Court of Germany. Last month I <a href="http://www.fosspatents.com/2014/10/german-ip-lawyers-evaluate-litigation.html">blogged about a study by a leading German IP law firm that raised the question of whether patents are merely "paper tigers."</a> A few days ago an English translation of that study <a href="http://www.bardehle.com/uploads/files/Patent_Papiertiger.pdf">was published on the Bardehle firm's website</a>.</p><p>In closing I'd just like to clarify that I'm not fundamentally opposed to the UPC or the Unitary Patent. In fact, my app development company filed three PCT applications this year and would <b><i>love</i></b> to choose "Unitary Patent" as a target jurisdiction for each of them at the end of the EPO process following the 31-month international phase. And apart from whether the Unitary Patent legislation will be ratified in time or not, I will want those patents to be enforceable Europe-wide. But true innovators need a fair chance to defend themselves against meritless assertions. I'd rather have to convince a court that an infringement causes irreparable harm to my business and that the covered feature is not just a minor feature of a multifunctional product, and wait for the outcome of a revocation proceeding before I obtain injunctive relief, than have to negotiate with countless patent trolls against the background of an unbalanced, backwards-oriented framework.</p><p><i>If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or <a href="http://twitter.com/FOSSpatents">follow me on Twitter @FOSSpatents</a> and <a href="https://plus.google.com/102642221637909015292/posts">Google+</a>.</i></p><p><a href="http://twitter.com/FOSSpatents" class="twitter-follow-button">Follow @FOSSpatents</a> <script src="http://platform.twitter.com/widgets.js" type="text/javascript"></script> </p><p>Share with other professionals via LinkedIn: <script type="text/javascript" src="http://platform.linkedin.com/in.js"></script> <script type="in/share" data-counter="right"></script><br /><br /><g:plusone annotation='inline'/><br /><!-- AddThis Button BEGIN --> <div class="addthis_toolbox addthis_default_style "><a href="http://www.addthis.com/bookmark.php?v=250&amp;pubid=ra-4d7528143c32fee2" class="addthis_button_compact">Share</a><span class="addthis_separator">|</span> <a class="addthis_button_preferred_1"></a><a class="addthis_button_preferred_2"></a> <a class="addthis_button_preferred_3"></a><a class="addthis_button_preferred_4"></a> </div><script type="text/javascript">var addthis_config = {"data_track_clickback":true};</script><script type="text/javascript" src="http://s7.addthis.com/js/250/addthis_widget.js#pubid=ra-4d7528143c32fee2"></script><!-- AddThis Button END --></p>Florian Muellerhttp://www.blogger.com/profile/13298342449544124176noreply@blogger.com